By Sanskriti Global Exports by Himanshu Gupta

Navigating the Crosscurrents: Rupee Volatility, FTA Hopes, and Policy Shifts Dominate Indian Trade

Date: 11 September 2025

In the ever-shifting sands of global trade, this week has presented Indian import-export professionals with a particularly dynamic landscape. A confluence of macroeconomic pressures, significant diplomatic progress, and domestic policy reviews has created both challenges and opportunities that demand immediate attention. The Indian Rupee breaching a new psychological barrier against the US Dollar is sending ripples through costing sheets, while a long-awaited breakthrough in the India-UK Free Trade Agreement (FTA) negotiations promises to redraw a key trade map. Compounding this is the government's decision to review the export obligations under its flagship Production Linked Incentive (PLI) schemes, signalling a more granular approach to its 'Make in India for the World' ambition. For the discerning trade professional, understanding these interconnected events is not just beneficial—it is critical for strategic survival and growth.

This Week's Factual Summary

Our desk has compiled the most significant developments impacting Indian trade this week. Here is a concise summary of the key events that are shaping the narrative.

Rupee Breaches ₹85 Mark Amidst Global Cues

The Indian Rupee (INR) depreciated past the crucial psychological level of ₹85 to the US Dollar in intra-day trading this Tuesday, before a suspected intervention by the Reserve Bank of India (RBI) helped it pare some losses. Market analysts attribute the slide to a combination of sustained dollar strength following hawkish commentary from the US Federal Reserve, rising global crude oil prices, and consistent demand for dollars from importers. While the RBI has reiterated its commitment to curbing excessive volatility, the currency's movement has put businesses on high alert.

Major Breakthrough Reported in India-UK FTA Negotiations

After several rounds of intense negotiations, sources from the Ministry of Commerce and Industry have indicated a "significant breakthrough" in the protracted India-UK FTA talks. The primary hurdles, particularly concerning rules of origin for textiles and automobiles, and market access for dairy and Scotch whisky, have reportedly been resolved in principle. While the final text is yet to be signed, negotiators are said to be finalising chapters on intellectual property rights and services, with an aim to conclude the deal before the end of the calendar year. This development is being hailed as a potential game-changer for bilateral trade, which has been a key post-Brexit objective for both nations.

Government to Review Export Obligations under Electronics PLI 2.0

The Empowered Committee overseeing the PLI schemes has announced a comprehensive review of the export performance and obligations for beneficiaries under the second phase of the scheme for large-scale electronics manufacturing. The review aims to assess the value addition being created in India and ensure that the incentives are genuinely fostering a globally competitive export hub. Industry observers note that this could lead to a tightening of compliance norms and potentially linking future disbursements more directly to realised export earnings, rather than just production figures.

JNPT Launches 'Digi-Clear' Platform to Slash Dwell Times

In a major boost to logistics efficiency, the Jawaharlal Nehru Port Trust (JNPT), one of India's busiest container ports, has launched its new integrated digital platform, 'Digi-Clear'. The system uses blockchain and AI to unify documentation from customs, shipping lines, and transporters, promising to reduce container dwell times by up to 30%. The platform's trial phase has been successful, and its full implementation is expected to significantly ease congestion and reduce logistics costs for businesses operating through the western coast.

Implications for Indian Import-Export Professionals

Translating these headlines into actionable intelligence is key. Here are the direct implications for your business:

• Currency Volatility Demands Proactive Hedging: The Rupee's breach of the ₹85 mark is a stark reminder of currency risk.
  • Exporters: While a weaker Rupee improves realisation in the short term, this volatility makes future planning difficult. It's an opportune moment to lock in favourable forward contracts for upcoming shipments.
  • Importers: Your landing costs have just increased. Businesses heavily reliant on imported raw materials or capital goods must immediately recalibrate their pricing strategies and explore hedging instruments like options and forwards to protect their margins.
• The UK FTA is an Impending Opportunity (and Threat): The reported breakthrough means businesses must prepare now, not later.
  • Sectors to Watch: Apparel, textiles, gems & jewellery, and pharmaceutical exporters should begin identifying potential buyers and understanding UK quality standards to gain a first-mover advantage once tariffs are reduced.
  • Prepare for Competition: Importers and domestic producers in sectors like high-end machinery, spirits, and certain financial services should brace for increased competition from UK-based firms.
• PLI Compliance is Set to Tighten: The review of the electronics PLI scheme is a bellwether for other sectors.
  • Beneficiaries must ensure their documentation related to value addition and export realisation is impeccable. A focus solely on production volume will no longer suffice. This signals a shift from quantity to quality of exports.
  • Businesses considering applying for future PLI schemes should build robust export strategies into their initial proposals.
• Digitisation at Ports is a Competitive Advantage: The launch of 'Digi-Clear' at JNPT is not just a procedural update; it's a strategic tool.
  • Companies that can quickly integrate their systems with this new platform will benefit from faster turnaround times and lower demurrage charges, creating a distinct cost advantage over competitors. Invest in training your logistics teams now.

Conclusion: A Call for Agility

The developments of this week encapsulate the modern reality of Indian trade: it is a complex interplay of global economics, national policy, and technological advancement. The message is clear—complacency is not an option. Success will be defined by agility. Businesses that proactively manage their currency exposure, strategically prepare for new trade alignments like the UK FTA, maintain stringent policy compliance, and embrace digital logistics innovations will not only weather the current uncertainties but will also be best-positioned to capitalise on the immense opportunities on the horizon. Staying informed is the first step; acting on that information is what will ultimately separate the leaders from the laggards.

Source: Original