Development Watch – Week #1 Aug’25

Development News

---

Rural economy improved in last 2 months

The economic condition of rural consumers in India has shown signs of improvement over the past two months, according to the Reserve Bank of India’s latest Rural Consumer Confidence Survey (RCCS). According to the latest survey, conducted during July 1 to 12, 2025, with 7,924 valid responses, rural consumer sentiment has improved marginally during the current period. As per the data, 41.6 percentage of rural consumers responses stated that their economic situation has improved in the past two months, while 24 per cent noted that it remains the same. Only 34.4 percentage said that their situation has worsened. About 7.1 percentage of respondents did not offer any response.

2,458 flights cancelled/re-scheduled due to geopolitics

Indian airlines faced significant disruptions this year, with 2,458 flights cancelled or rescheduled due to regulatory and geopolitical issues, according to the civil aviation ministry. IndiGo and Air India were most affected, cancelling or rescheduling 1,017 and 662 flights, respectively. Despite these challenges, domestic airlines saw a 7.34% passenger growth from January to June 2025 compared to last year. Airlines incur costs due to delays and cancellations, including additional fuel, crew overtime, maintenance, airport fees, and rebooking expenses.

Mahindra to export EVs to the UK

Mumbai-based Mahindra & Mahindra is preparing to export its electric vehicles (EVs) to the United Kingdom, leveraging opportunities arising from the recently finalized India-UK free trade agreement (FTA). The company, a leading player in India’s domestic EV segment, expects electric vehicles to account for 30 per cent of its overall sales by 2030. In 2022, Mahindra inaugurated its Mahindra Advanced Design Europe (M.A.D.E) facility in Banbury, Oxfordshire. It serves as the conceptual hub for the company’s electric product portfolio. While the industry is currently smaller, improvements in ease of doing business, logistics costs, and import duties are enabling the production of higher-quality vehicles domestically.

Transition from colonial steam engines to Vande Bharat

Indian Railways began its journey in 1853, connecting Bombay and Thane. It transformed from steam engines to modern trains like Vande Bharat Express. The network was nationalised post-independence. Key milestones include Rajdhani Express and Kolkata Metro. Now, Indian Railways focuses on speed and technology. The Mumbai-Ahmedabad bullet train project aims for completion by 2029. The years that followed saw an ambitious expansion drive, major gauge conversion under Project Unigauge, and a steady shift from steam to diesel (1957), and then to widespread electrification, which began in earnest after the first electric train ran between Bombay and Kurla in 1925.

SCI to buy local vessels in $1 billion deal

Shipping Corporation of India (SCI) is planning a big purchase. It will buy twenty-six ships made in India. This is part of a government plan. The goal is to boost India’s shipbuilding industry. Other sectors like petroleum and steel will also buy ships. The total value of these orders is very high. SCI the country’s largest shipping line, is working on a plan to purchase 26 India-made ships for 198.2 billion rupees ($2.3 billion) as part of a government initiative to boost the domestic shipbuilding industry. The ships will have cumulative internal volume of 1.18 million gross tonnes, and delivery will be staggered over several years as they are completed. It comes amid a wave of orders from other buyers in India’s petroleum and natural gas, steel and fertilizer sectors, who along with SCI plan to procure a grand total of 207 ships valued at nearly 1.5 trillion rupees. This plan is part of an existing initiative to purchase 112 crude carriers through 2040, as the world’s third-biggest importer of oil seeks to build out its tonnage.

Rs. 10 Lakh Cr of road projects to be awarded every year

The government aims to award road projects worth Rs 10 lakh crore every year going forward with a target of Rs 7 lakh crore of projects awarded by the end of 2025-26. The sector witnessed some slowdown in the last one year due to the cancellation of the Bharatmala project. The MoRTH Minister was speaking at the annual session of the Indian Construction Equipment Manufacturers Association (ICEMA). The ministry has already awarded projects worth Rs 2 lakh crore and the target is to award projects worth Rs 5 lakh crore more by the end of the current financial year.

$1 billion fund for green affordable housing finance

The International Finance Corporation (IFC) is anchoring a $1 billion real estate fund with HDFC Capital Advisors, aiming to boost green affordable housing in India. IFC’s $150 million investment in the H-DREAM Fund will help mobilize $850 million from other investors. The fund will finance projects implementing green building standards, addressing the housing gap and promoting sustainable urban growth. IFC, a member of the World Bank Group, will invest up to $150 million (about Rs 1,320 crore), in the HDFC Capital Development of Real Estate Affordable and Mid-Income Fund (H-DREAM Fund). It will be managed by HDFC Capital, the real estate private equity arm of the HDFC Group.