📰India Privatizes, IPL Kicks Off, Trade Deficit Shrinks

Good evening, 

Welcome to the best way to stay up-to-date on India’s financial markets. Here’s what’s in today’s newsletter:

• India is privatizing 11 airports,

• The world’s largest cricket tournament kicks off… a feud with the Indian government,

• and India recorded its smallest trade deficit in over three years,

Then, we close with Gupshup, a round-up of the most important headlines.

BTW: If you listened to PM Narendra Modi’s interview with Lex Fridman, tell us what you think!

Have a question you want us to answer? Fill out this form and you could be featured in our newsletter.

—Shreyas, [email protected]

Market Update.

India Is Privatizing 11 Airports.

India is set to privatize 11 airports as part of its ongoing efforts to modernize infrastructure, attract private investment, and liberalize the government’s economic entrenchment. This move aligns with Modi’s broader plan to raise $5.4 billion (₹470 billion) through asset sales in the upcoming year, reducing India’s budgetary shortfall and increasing private sector participation in aviation.  

The state-run Airports Authority of India (AAI) is finalizing the privatization framework with government approval expected within a month. The plan involves selling the airports in the following bundled pairs:  

• Varanasi (profitable) + Kushinagar & Gaya (loss-making)  

• Bhubaneswar (profitable) + Hubli & Kangra (loss-making)  

• Raipur (profitable) + Aurangabad (loss-making)  

• Tiruchirapalli (profitable) + Tirupati (loss-making)  

Why do this? India’s domestic aviation market is the third-largest globally, following the US and China. The government estimates that passenger traffic will double to 300 million per year by 2030, making airport expansion and modernization essential.  

However, many smaller airports remain underutilized, operating at a loss due to low passenger demand and inadequate infrastructure. The government’s bundling approach ensures that these airports receive much-needed investment, rather than being left out of India’s aviation growth story.  

Additionally, the revenue-sharing model—where bidders commit to sharing the highest revenue per passenger with AAI—ensures that privatized airports remain profitable for the government as well. Since this model is inflation-linked, earnings will naturally increase over time, making it a sustainable and transparent solution.

The top bidders thus far are Adani and GMR. India’s third phase of airport privatization is expected to be completed by end-2025. The first phase of airport divestment began in 2006, when Delhi and Mumbai airports were privatized and handed over to GMR and GVK, respectively. The second phase, completed in 2021, saw six airports transferred to Adani Group, marking a major shift toward private-sector-led airport management.  

The privatization of India’s airports presents a lucrative opportunity for international investors and infrastructure funds looking to expand in one of the world’s fastest-growing aviation markets. The air market will double in size by 2030 and the government is offering tax incentives and lessened regulation for FDI in infra.

The IPL’s Advertising Feud with the Government.

If cricket is a religion in India, then the IPL is its grandest annual festival. The 18th season of the IPL kicks off this week, drawing in more than a billion viewers worldwide and reinforcing its status as one of the world’s top 10 richest sports leagues. With an estimated valuation of $16 billion (₹1.4 trillion), the league is not just a sporting event but a marketing powerhouse, attracting millions of dollars in advertising revenue from top global and Indian brands.

The dark side of advertising: Yet, as the cricketing extravaganza takes center stage, India’s Health Ministry has raised an urgent concern—the growing influence of surrogate advertising for alcohol and tobacco products in an environment where millions of children are among the primary audience. India has legally banned direct advertising of tobacco and alcohol since the early 2000s. However, companies have circumvented these laws by promoting pan masala (a chewing product often linked to tobacco), soda, and mouth fresheners—products that are often strategic stand-ins for banned categories.  

This practice has become increasingly widespread in the IPL, with firms selling pan masala ranking among the top advertisers in both 2023 and 2024. During the 2023 Cricket World Cup, a staggering 40 percent of all ads promoted tobacco-linked brands, despite restrictions.  

Given that India has one of the highest global rates of oral cancer and one in five Indians consumes smokeless tobacco, such aggressive marketing has triggered a strong response from health advocates and parents alike. The ministry emphasized that since the IPL is India’s most-watched sports event, allowing such advertising sends a contradictory message to the public about health, fitness, and sportsmanship.  

Promotion: One of the most challenging aspects of curbing such promotions is the deep interlinking of cricket, Bollywood, and brand endorsements. Some of the biggest Bollywood superstars, including Shah Rukh Khan, and legendary cricketers like Kapil Dev, have promoted pan masala brands.  

Many viewers, however, are growing tired of these endorsements. Sachin Taparia, founder of LocalCircles, a community advocacy platform, noted that since 2017, there has been a surge in complaints from parents who worry about the influence of these ads on their children.  

The IPL thrives on advertising revenue, and eliminating an entire category of top-paying sponsors would have financial implications. In the past, even major cricketing bodies have hesitated to ban such sponsorships due to their significant monetary contributions completely.

India Posts Its Smallest Trade Deficit.

India recorded its smallest trade deficit in over three years in February 2025, providing much-needed relief for policymakers amid ongoing global trade tensions and geopolitical uncertainties. The trade gap shrank to $14.1 billion (₹1.2 trillion), significantly lower than the $21.3 billion (₹1.9 trillion) deficit projected by economists and a sharp improvement from January’s $23 billion (₹2 trillion) shortfall.  

The reduced deficit is primarily due to falling imports, which dropped by 16 percent to $51 billion (₹4.4 trillion), while exports also saw an 11 percent decline to $36.9 billion (₹3.2 trillion) compared to last year. A key factor in this development is the softening of global oil prices, which has helped reduce India’s oil import bill.   

As India imports nearly 90 percent of its crude oil, fluctuations in energy prices have a direct impact on the country’s trade balance and currency stability. The recent drop in oil prices has eased pressure on the Indian rupee, which had depreciated 1 percent against the US dollar in February.  

Despite the improvement in the trade balance, India’s exports remain under pressure due to rising global trade restrictions, particularly from the United States. The US has already levied a 25 percent tariff on steel and aluminum imports, affecting $7 billion (₹609 billion) worth of Indian exports. This has forced the Indian government to engage in active negotiations to protect its trade interests.  

• Earlier this month, India’s Commerce Minister Piyush Goyal met US Trade Rep Jamieson Greer to discuss a potential bilateral trade agreement aimed at resolving tariff disputes.  

• Trade Secretary Sunil Barthwal described the negotiations as moving in a “positive direction”, with both sides exploring ways to minimize the impact of US tariffs.  

To counter potential losses from US tariffs, India has accelerated efforts to expand FTAs with New Zealand, Britain, and the EU. A shrinking trade deficit and lower import costs provide economic relief, but concerns remain over falling exports due to global demand slowdowns and increasing trade barriers.

Message from our Sponsor

Stay Informed, Without the Noise.

Your inbox is full of news. But how much of it is actually useful? The Daily Upside delivers sharp, insightful market analysis—without the fluff. Free, fast, and trusted by 1M+ investors. Stay ahead of the market in just a few minutes a day.

Subscribe today.

Gupshup.

Macro

• India is working on a FTA with New Zealand. Commerce Minister Goyal met with NZ Trade Minister McClay to hammer out a deal while tariffs are being set globally. India exports infra goods while New Zealand has food products and cloth. 

• Wholesale inflation hit 2.38 percent, furthering the inflation reduction narrative. Wholesale is similar to what producers and businesses are paying for goods. Since February wholesale is falling, consumer prices should decrease in March and moving forward.

Equities

• The VIX has declined for four straight weeks, a sign of less risk. Normally, there is a spot-vol relationship where as volatility decreases, equity prices generally rise. The Nifty, however, has been flat to even down in that time.  

• IndusInd has to remediate its derivatives book this quarter. The RBI cut CEO Kathpalia’s term to just one year after trading discrepancies were found. Shares traded down 27 percent even with a RBI statement saying not to worry for consumers with deposits.

• The SBI is shelving a $1.7 billion (₹150 billion) fundraising plan due to high yields. The bank will likely come to funding markets next year as they expect rate cuts to make their way through the yield curve. 

• Ola hits a new bottom after getting insolvency petitions by creditors. Rosmerta, the creditor, alleged default on interest payments which could force Ola to declare bankruptcy. Ever since expanding into 4,000 stores last year, the company has faced net losses, litigation, and public scrutiny.    

Alts

• Maharashtra is going to raise $1.7 billion (₹150 billion) through a bond sale for infra. The sale will likely happen in batches with the minimum tenor being 15 years. The borrowing is part of a push to renovate roads and public transportation as India’s economy keeps growing. The MSRDC is returning to corporate bond markets after a 15-year hiatus. 

• India's option trading bans have led to contract trading falling by 77 percent. The 30-day rolling average showed a decline in the number of contracts traded and the number of traders also hit a 17-month low.  

Policy

• Trade Secretary Barthwal views trade talks as positive. Both he and Commerce Minister Goyal have been in the US negotiating with Trump’s team on reciprocal tariffs. India is currently thinking about putting a steel “safeguard” after the US put a 25 percent duty on the material.

• India's next election will be framed by the south. Tamil Nadu Chief Minister Stalin has been rallying the South together against the Hindu totalitarianism from Modi and the BJP. The feud started when the BJP announced a reweighting of parliament seats by population.

See you Tuesday.

Written by Yash Tibrewal. Edited by Shreyas Sinha.

Disclaimer: This is not financial advice or recommendation for any investment. The Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.