New Delhi: Economists on Tuesday said the GST 2.0 reforms are set to create new Diwali shopping records in the country as purchasing power has considerably gone up while inflation has come down to a historic low. 

The reduction in GST has put more money in people’s hands and when purchasing power increases, inflation automatically decreases.

“The reduction in retail prices has had the greatest impact on the lower and middle classes. Those who used to be able to buy one item, say for Rs 100, are now able to buy multiple items,” Harvansh Chawla, Chairman, BRICS Chamber of Commerce and Industry, told IANS.

According to him, this is going to be a “historic Diwali”.

“Sales that will take place this Diwali will be unprecedented and traders will be immensely benefitted,” he added.

According to economist Dr Manoranjan Sharma, India’s inflation rate based on the Consumer Price Index (CPI) declined to an over 8-year low of 1.54 per cent in September this year, compared to the same month of the previous year, as prices of food items and fuels turned cheaper during the month.

Moreover, India’s annual rate of inflation based on the Wholesale Price Index (WPI) eased to 0.13 per cent in September from 0.52 per cent in August.

September GST collections also hit Rs 1.89 lakh crore, showing 9.1 per cent YoY growth, reflecting recent rate cuts.

“Today, the common man has more money left with him, which we call disposable income which has provided relief to millions of people,” Dr Sharma told IANS.

“This Diwali, you may see a greater increase in shopping owing to GST cuts. The festive atmosphere will be more pleasant than before as people will now be able to shop more, and traders will also benefit in the due course,” he added.

GST reforms have led to lower prices, smoother credit flow, resolution of tax inversion issues and reduced disputes, ultimately cutting costs for producers and consumers alike.

US President Donald Trump on Tuesday claimed that China is “purposefully” not buying the soybeans from their farmers, and this is the reason they are considering terminating the business with Beijing.Calling China’s deliberate work an “economically hostile act,” Trump said that they can make the cooking oil themselves and don’t need China for that. In a post on Truth Social, Trump said, “I believe that China purposefully not buying our Soybeans, and causing difficulty for our Soybean Farmers, is an Economically Hostile Act. We are considering terminating business with China having to do with Cooking Oil, and other elements of Trade, as retribution. As an example, we can easily produce Cooking Oil ourselves, we don’t need to purchase it from China.”The United States soya bean harvest is under way, and China, once the biggest buyer of American soybeans, hasn’t booked a single purchase, sending prices tumbling and farmers into panic. The abrupt halt mirrors Beijing’s previous use of rare earth exports as leverage in trade wars. Now, it’s soybeans.

Why it matters?

The United States, which exports approximately 61% of the world’s soybeans, has recorded zero purchases from China for the current harvest, a sharp decline from Rs 1.05 lakh crore in purchases last year. This shift is part of an escalating trade dispute, with Beijing leveraging economic measures in response to President Trump’s renewed tariffs. Lu Ting, chief China economist at Nomura Holdings, stated, “US soybeans now are not that important to China. That’s why Beijing can afford to use the import ban as a bargaining tool.” Additionally, the Trump tariffs have increased costs for fertilizer and equipment, thereby reducing farmers’ profit margins. Farmers across the Midwest have begun storing crops, postponing sales, and observing declining futures markets. Morey Hill, a soybean grower from Iowa, told the Wall Street Journal, “There’s no incentive to sell right now.” Hill warned that without a timely agreement with China, the soybean market “might be a bloodbath.” US farmers are currently grappling with higher expenses and a reduction in buyers.

Is it soya war or something else

This isn’t just about soy. This situation mirrors China’s earlier strategy with rare earth minerals, used as leverage in negotiations with the Trump administration over export controls. Now, as the soybean harvest commences, Beijing is repeating this tactic. Lu Ting noted, “Beijing’s new bargaining chip is an import ban on US soybean,” as reported by Bloomberg.While soybeans may not possess the unique qualities of rare earths, they are essential for China’s substantial hog and poultry industries. Escalating trade tensions have led China to increase soybean imports from South America, purchasing 2 million tons from Argentina in September alone. Dean Buchholz, a farmer concluding his final crop this year, expressed his discontent to the Wall Street Journal, saying, “I always thought I would farm till they threw dirt on top of me.” He added, “I can’t make it work to where it would be practical to keep going without me spending a boatload of money and keep putting myself into more debt.” Caleb Ragland, 39, a Kentucky farmer and president of the American Soybean Association, commented, “The frustration is overwhelming.” The timing compounds the issue, as over half of US soybean exports typically occur between October and December, immediately following harvest. China is delaying purchases until February when Brazil’s crop becomes available. Sarah Taber, a crop scientist and blogger from North Carolina, remarked, “We knew what Trump would do. And a lot of farmers just voted for him anyway.” Taber warned that if no agreement is reached by December, US soy exports could miss the entire global buying window.

The Indian rupee fell 13 paise to close at an all-time low of 88.81 against the US dollar on Tuesday, pressured by weak domestic equities and a firm dollar amid global risk-off sentiment, according to market sources.Forex traders said foreign fund outflows amid risk-averse global conditions further dented investor sentiment. However, a drop in crude oil prices and reports of Reserve Bank of India (RBI) intervention supported the local unit and curtailed sharper losses, PTI reported.At the interbank foreign exchange, the rupee opened at 88.73 against the greenback, touched an intraday low of 88.82, and a high of 88.73 before settling at 88.81, down from the previous close of 88.68. On September 30, the rupee had touched 88.80, its previous all-time low.“The rupee… [was] pressured by broad-based dollar strength and weaker regional currencies. Sentiment remains fragile amid US-China trade uncertainty and risk-averse moods. However, the rupee has demonstrated resilience, consolidating in a narrow range over the past two weeks due to central bank intervention and foreign fund inflows. Near-term, spot USD/INR finds support at 88.50 and faces resistance at 89.10,” said Dilip Parmar, Senior Research Analyst, HDFC Securities.The dollar index, which tracks the greenback against a basket of six currencies, was trading 0.10 per cent higher at 99.36. Brent crude futures fell 2.15 per cent to USD 61.99 per barrel.Experts noted that US-India trade tariffs remain a concern for investor sentiment. A senior official said a team of Indian officials will visit the US this week for trade talks, with the first tranche of a proposed Bilateral Trade Agreement (BTA) aimed for conclusion between October and November 2025. Five rounds of negotiations have been completed so far.“A weak tone in global crude oil prices and FII inflows may favour the rupee. The US government shutdown and rising odds of a rate cut by the US Federal Reserve may further weigh on the US Dollar. USD/INR spot price is expected to trade in a range of 88.50 to 89,” said Anuj Choudhary, Research Analyst, Currency and Commodities, Mirae Asset ShareKhan, PTI quoted.On the domestic data front, India’s Consumer Price Index (CPI) inflation eased to an eight-year low of 1.54 per cent in September from 2.07 per cent in August, falling below the RBI’s 2 per cent target. Wholesale Price Index (WPI) inflation also cooled to 0.13 per cent in September from 0.52 per cent in August.Domestic equities also fell, with the Sensex dropping 297.07 points to 82,029.98 and the Nifty declining 81.85 points to 25,145.50. Foreign Institutional Investors sold equities worth Rs 1,508.53 crore on Tuesday, exchange data showed.