Politics
Modi’s tax overhaul to strain finances but boost image amid US trade tensions

- Modi announces most major tax reform in eight years.
- Move could spur consumption but pinch tax revenues.
- Decision seen helping Modi in trade fight and local politics.
NEW DELHI: Indian Prime Minister Narendra Modi’s deepest tax cuts in eight years will strain government revenues but are winning praise from businesses and political pundits who say they will bolster his image in an ongoing trade fight with Washington.
In the biggest tax overhaul since 2017, Modi’s government on Saturday announced sweeping changes to the complex goods and services tax (GST) regime which will make daily essentials and electronics cheaper from October.
At the same time, in his Independence Day speech on Friday, Modi urged Indians to use more goods made domestically, echoing calls from many of his supporters to boycott US products after Donald Trump hiked tariffs on imports from India to 50% as of August 27.
The tax cut plan comes with costs given GST is a major revenue generator. IDFC First Bank says the cuts will boost India’s GDP by 0.6 percentage points over 12 months but will cost the state and federal government $20 billion annually.
But it will improve weak stock market sentiment and bring political dividends for Modi ahead of a critical state election in the eastern state of Bihar, said Rasheed Kidwai, a fellow at New Delhi-based Observer Research Foundation.
“GST reduction will impact everyone, unlike cuts to income tax, which is paid by only 3%-4% of the population. Modi is doing this as he is under a lot of pressure due to US policies,” said Kidwai.
“The move will also help the stock market, which is now politically important as it has a lot of retail investors.”
India launched the major tax system in 2017 that subsumed local state taxes into the new, nationwide GST to unify its economy for the first time.
But the biggest tax reform since India’s independence faced criticism for its complex design that taxes products and services under four slabs – 5%, 12%, 18% and 28%.
Last year, India said caramel popcorn would be taxed at 18% but the salted category at 5%, triggering criticism about a glaring example of GST’s complexities.
Under the new system, India will abolish the 28% slab – which includes cars and electronics – and move nearly all of the items under the 12% category to the lower 5% slab, benefitting many more consumer items and packaged foods.
Government data shows the 28% and 12% tax slabs together garner 16% of India’s annual GST revenue of roughly $250 billion last fiscal year.
‘A brighter gift’ and politics
Bihar is a key state politically and goes to the polls by November. A recent survey by the VoteVibe agency showed Modi’s opposition has an edge largely because of a lack of jobs.
“Any tax cut has wide public appreciation. But of course, the timing is purely determined by political exigencies,” said Dilip Cherian, a communications consultant and co-founder of Indian public relations firm Perfect Relations.
“It seems to be an indication of some mixture of frustration as well as recognition that there is a broad public pushback against high and crippling rates of taxation.”
Modi’s ruling Bharatiya Janata Party has seized on his tax announcement, posting on X that on the Hindu festival of lights, Diwali, “a brighter gift of simpler taxes and more savings is waiting for every Indian.”
Modi has vowed to protect farmers, fishermen and cattlemen, following Trump’s surprise tariff announcement on India, after trade talks between New Delhi and Washington collapsed over disagreement on opening India’s vast farm and dairy sectors and stopping Russian oil purchases.
The latest round of trade talks between the two nations set for August 25-29 has also been called off.
Politics
Indian man kills wife, takes selfie with dead body

A man in India’s south brutally killed his estranged wife at a women’s hostel and took a selfie with her dead body, according to NDTV.
The victim, identified as Sripriya, employed at a private firm in Coimbatore, Tamil Nadu, had separated from her husband, Balamurugam, who was from Tirunelveli.
Police said the suspect arrived at the hostel on Sunday afternoon, concealing a sickle in his clothes, and was seeking to meet her.
They had an argument soon after the couple met, and the feud turned into a violent attack by Balamurugan, who drew the sickle and hacked the woman to death.
Furthermore, the police said he then took a selfie with her body and shared it on his WhatsApp status, accusing her of “betrayal”.
The incident spread panic and chaos in the hostel.
Following the brutal murder, the suspect did not escape from the spot but waited until the police arrived, and he was arrested at the crime scene. The murder weapon was recovered.
The initial investigation suggested that he suspected his wife of being in a relationship with another man.
Politics
Southeast Asia storm deaths near 700 as scale of disaster revealed

- Indonesia, Malaysia and Thailand witness large scale devastation.
- At least 176 people perish in Thailand and three in Malaysia.
- Indonesia’s death toll reaches 502 with 508 more still missing.
PALEMBAYAN: Rescue teams in western Indonesia were battling on Monday to clear roads cut off by cyclone-induced landslides and floods, as improved weather revealed more of the scale of a disaster that has killed close to 700 people in Southeast Asia.
Indonesia, Malaysia and Thailand have seen large scale devastation after a rare tropical storm formed in the Malacca Strait, fuelling torrential rains and wind gusts for a week that hampered efforts to reach people stranded by mudslides and high floodwaters.
At least 176 have been killed in Thailand and three in Malaysia, while the death toll climbed to 502 in Indonesia on Monday with 508 missing, according to official figures.
Under sunshine and clear blue skies in the town of Palembayan in Indonesia’s West Sumatra, hundreds of people were clearing mud, trees and wreckage from roads as some residents tried to salvage valuable items like documents and motorcycles from their damaged homes.

Men in camouflage outfits sifted through piles of mangled poles, concrete and sheet metal roofing as pickup trucks packed with people drove around looking for missing family members and handing out water to people, some trudging through knee-deep mud.
Months of adverse, deadly weather
The government’s recovery efforts include restoring roads, bridges and telecommunication services.
More than 28,000 homes have been damaged in Indonesia and 1.4 million people affected, according to the disaster agency.
Indonesian President Prabowo Subianto visited the three affected provinces on Monday and praised residents for their spirit in the face of what he called a catastrophe.
“There are roads that are still cut off, but we’re doing everything we can to overcome difficulties,” he said in North Sumatra.
“We face this disaster with resilience and solidarity. Our nation is strong right now, able to overcome this.”
The devastation in the three countries follows months of adverse and deadly weather in Southeast Asia, including typhoons that have lashed the Philippines and Vietnam and caused frequent and prolonged flooding elsewhere.

Scientists have warned that extreme weather events will become more frequent as a result of global warming.
Marooned for days
In Thailand, the death toll rose slightly to 176 on Monday from flooding in eight southern provinces that affected about three million people and led to a major mobilisation of its military to evacuate critical patients from hospitals and reach people marooned for days by floodwaters.
In the hardest-hit province of Songkhla, where 138 people were killed, the government said 85% of water services had been restored and would be fully operational by Wednesday.
Much of Thailand’s recovery effort is focused on the worst-affected city Hat Yai, a southern trading hub which on November 21 received 335 mm (13 inches) of rain, its highest single-day tally in 300 years, followed by days of unrelenting downpours.
Prime Minister Anutin Charnvirakul has set a timeline of seven days for residents to return to their homes, a government spokesperson said on Monday.
In neighbouring Malaysia, 11,600 people were still in evacuation centres, according to the country’s disaster agency, which said it was still on alert for a second and third wave of flooding.
Politics
British MP Tulip Siddiq handed two-year prison sentence in Bangladesh graft case

- Ex-Bangladesh PM Sheikh Hasina, sister Rehana also sentenced.
- Case relates to illegal allocation of a plot of land: local media.
- Prosecutors highlight political influence, collusion abuse of power.
DHAKA: A Bangladesh court sentenced British parliamentarian and former minister Tulip Siddiq to two years in jail in a corruption case involving the alleged illegal allocation of a plot of land, local media reported.
The verdict was delivered in absentia as Siddiq, her aunt and former Bangladesh Prime Minister Sheikh Hasina, and Hasina’s sister Sheikh Rehana — all co-accused in the case — were not present in court.
Hasina was sentenced to five years in jail and Rehana to seven, the local media reports said.
Hasina, who fled to neighbouring India in August 2024 at the height of an uprising against her government, was sentenced to death last month over her government’s violent crackdown on demonstrators during the protests.
Last week, she was handed a combined 21-year prison sentence in other corruption cases.
Prosecutors said that the land was unlawfully allocated through political influence and collusion with senior officials, accusing the three powerful defendants of abusing their authority to secure the plot, measuring roughly 13,610 square feet, during Hasina’s tenure as prime minister.
Most of the 17 accused were absent when the judgement was pronounced.
Siddiq, who resigned in January as the UK’s minister responsible for financial services and anti-corruption efforts following scrutiny over her financial ties to Hasina, has previously dismissed the allegations as a “politically motivated smear”.
Britain does not currently have an extradition treaty with Bangladesh.
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