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Thailand’s post–COVID-19 economic recovery has been characterized by persistently weak growth, averaging only 2.3 percent during 2022–2024—well below its pre-pandemic performance and far from its historical peaks.

Key Points

• 📉 Growth slowdown: Thailand’s post-COVID recovery has been weak, averaging only 2.3% growth (2022–2024), far below historical peaks. This is seen as a structural, long-term decline rather than a temporary shock.
• 👥 Labor issues: Aging population, early retirement, conscription, preventable deaths, and declining education quality reduce both labor supply and productivity.
• 💰 Capital & productivity: Investment growth has slowed, and total factor productivity (TFP) gains have weakened, signaling declining fundamentals.
• 🏛️ Fiscal strain: Rising public debt (61% of GDP) and persistent deficits risk credit downgrades, with populist policies adding pressure.
• 🏠 Household debt: Exceptionally high for a developing economy (around 90% of GDP), constraining consumption and growth.
• 🌍 Exports & FDI: Export competitiveness is eroding under new tariffs and trade conflicts. FDI is shifting from Japanese-led industries to Chinese firms and data centers, with fewer local spillovers.
• ✈️ Tourism: Still below pre-pandemic levels, facing overcrowding, environmental issues, and stronger competition from regional peers.
• 📲 Services trade: Imports of services (digital platforms, IT, streaming, etc.) are rising faster than exports, creating a negative balance.

This paper argues that the slowdown reflects not a temporary cyclical shock, but a deepening structural deterioration in Thailand’s long-term growth potential. As the second installment in a three-part analytical series, the study focuses on diagnosing the key structural constraints that have contributed to Thailand’s sustained deceleration in growth relative to regional peers.

Using a combination of quantitative indicators and qualitative policy analysis, the paper examines ten core structural factors shaping Thailand’s growth dynamics: labor, capital, total factor productivity, fiscal sustainability, household debt, the goods-exporting sector, foreign direct investment, tourism, the services-importing sector, and external threats.

The analysis reveals that weaknesses are broad-based and mutually reinforcing. Demographic aging, early labor-force exit, and declining education quality are constraining labor supply and productivity. Sluggish investment and slowing total factor productivity signal weakening growth fundamentals. At the same time, high household debt, limited fiscal space, declining export competitiveness, changing patterns of foreign direct investment, a stagnating tourism model, and a widening deficit in services trade further undermine economic momentum. These challenges are compounded by rising exposure to global trade fragmentation and climate-related risks.

Taken together, the findings suggest that Thailand’s growth engine is impaired across multiple components rather than hindered by a single binding constraint. Each structural area requires targeted policy interventions to stabilize and, collectively, revive Thailand’s long-term growth trajectory.

Introduction

In the aftermath of the COVID-19 pandemic, Thailand’s economic growth during the period 2022–2024 averaged only around 2.3 percent, representing a marked slowdown compared with the pre-COVID period (2010–2019), when average growth stood at approximately 3.2 percent. This deceleration should not be interpreted as a temporary cyclical weakness. Rather, it reflects a deeper and more persistent deterioration in Thailand’s long-term growth prospects. Historically, Thailand’s GDP growth peaked at an average of 7.3 percent during 1993–1996, before declining to around 5.3 percent during 1999–2007, and subsequently falling further in the pre-COVID decade. Looking ahead, long-term projections suggest that Thailand’s growth rate will continue to decline steadily, period by period, at least until 2080 (Bisonyabut & Tantisan, 2025).

The downward revision of Thailand’s GDP growth trajectory is therefore not unexpected when viewed against the backdrop of the country’s accumulated structural challenges and the limited success of past efforts to address them. What is striking, however, is not merely the presence of these challenges, but their breadth and persistence. Multiple structural weaknesses continue to weigh on economic performance, collectively signaling a broad erosion of competitiveness. Thailand’s growth engine increasingly resembles an economic system suffering from failures across multiple components, rather than a single malfunctioning part.

This paper constitutes the second installment in a three-part series examining Thailand’s prolonged economic slowdown through three complementary analytical lenses. The first paper, published earlier, traced Thailand’s growth trajectory from its historical peak to the present, demonstrating that the observed slowdown is fundamentally structural and long-term in nature, with potentially severe consequences if left unaddressed. Building on that foundation, this paper focuses on identifying the key structural challenges that have contributed to Thailand’s persistently weak growth relative to its regional peers. The third paper, forthcoming, will examine institutional constraints that have hindered effective reform, helping to explain why well-known policy proposals have repeatedly failed to translate into meaningful and sustained progress.

Untangling Structural Challenges

To identify the underlying causes of Thailand’s long-term GDP projection decline, this paper examines a set of core macroeconomic structural factors that together form the backbone of the Thai economy. These include:

• labor
• capital,
• total factor productivity,
• fiscal sustainability,
• household debt,
• goods exporting sector,
• foreign direct investment (FDI) sector,
• tourism sector,
• import services sector
• external threats.

These structural components encompass both the supply side and the demand side of the economy and represent the primary channels through which economic growth is generated in Thailand. Weaknesses in any one of these areas can constrain growth; however, when multiple factors deteriorate simultaneously, their combined effects can substantially depress long-term GDP performance.

For each structural factor, this study employs quantitative and/or qualitative analyses to evaluate the extent to which it has supported or constrained Thailand’s economic growth over time. Where appropriate, empirical evidence is complemented by institutional and policy analysis to capture mechanisms that may not be fully observable in aggregate data. Based on these assessments, policy recommendations are proposed for each factor with the aim of mitigating structural constraints and improving Thailand’s long-term growth potential.

Findings

This section presents a detailed analysis of each structural factor, along with corresponding policy recommendations aimed at addressing identified weaknesses and enhancing Thailand’s long-term economic performance.

Labor

Labor employed in the agricultural, manufacturing, or service sectors directly contributes to GDP by producing goods and services that add value to the economy. A key challenge for this growth factor is demographic aging: as the population ages, the labor force both shrinks and becomes older, thereby limiting its contribution to GDP growth. Thailand currently faces several challenges related to this factor.

High-income economies typically counter labor-force shrinkage by extending the retirement age. As shown in Figure 1, most high-income economies have an official retirement age of around 65, while developing economies tend to maintain an official retirement age closer to 60.

In Thailand, there is no formal retirement age for most workers, except for civil servants, whose mandatory retirement age is 60. However, in practice, many workers retire earlier—often around age 55—which coincides with the age at which individuals become eligible to leave their jobs and receive pension benefits. More concerningly, labor-force statistics (Figure 2) indicate that a significant number of workers exit the labor market as early as their early 50s (TDRI, 2025a).

In addition, Thailand loses part of its labor force through channels that are largely avoidable. Three notable examples include:

• Mandatory military conscription among young workers (Prachathai, 2019);
• loss of life due to road accidents (approximately 16,000–20,000 fatalities per year, TDRI, 2025b); and
• premature deaths related to climate-related incidents, including natural disasters (Kosako, 2025) and prolonged exposure to PM2.5 pollution (Hermayurisca & Taneepanichskul, 2023).

Qualitative aspects further exacerbate the problem. Recent PISA test results (PISA, 2022) show that Thailand’s scores are below the OECD average and below those of peer economies such as China, Malaysia,and Vietnam. More importantly, the trend in Thailand’s educational performance has been declining over time.

In summary, population aging and labor-force shrinkage constitute major constraints on GDP growth. These challenges are compounded by both quantitative losses of labor and declining labor quality. Government policy should therefore focus on extending working lives by raising the effective retirement age and keeping workers in the labor market for as long as possible. At the same time, it should address labor leakage through mechanisms such as military conscription and preventable premature deaths, while placing greater emphasis on improving labor quality.

Capital

Capital refers to machinery and equipment used in the production of goods and services. In Thailand, capital investment indicators have remained sluggish following the COVID-19 pandemic. According to the Bank of Thailand’s database, Business loan growth declined from an average of 4.3% during 2015–2019 (pre-COVID) to just 2.3% between 2021–2024. Similarly, according to NESDC’s database, investment as a share of GDP has grown more slowly, falling from an average growth rate of 2.9% to 1.7% over the same period. Notably, a strong investment cycle is typically characterized by growth rates of around 3.5%–7% per year.

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However, the decline in investment indicators should not be viewed as a standalone problem to be addressed directly. Rather, it reflects deeper structural weaknesses, particularly in foreign direct investment (FDI) and export performance, which will be discussed in subsequent sections.

Total Factor Productivity

Total factor productivity (TFP) measures how efficiently an economy transforms labor and capital into output, capturing gains from technology, innovation, skills, and organizational improvements beyond the mere accumulation of labor and capital. Based on NESDC analysis, TFP accounted for approximately 50% of Thailand’s GDP growth during 2011–2024. However, a clear slowdown in TFP growth has been observed in the post-COVID period. During 2015–2019, TFP growth averaged around 2.0% per year, but following the COVID-19 shock, it declined to just 1.34% per year, signaling increasing constraints on Thailand’s future growth potential (NESDC, 2025).

This trend underscores the urgent need to strengthen Thailand’s technology and innovation system, including policies that support technological upgrading, technology transfer, and the effective adoption of new technologies across firms and sectors.

Fiscal Sustainability

Thailand’s post–COVID-19 GDP growth slowdown is very pronounced, but less widely recognized is the fact that fiscal policy has already been stretched in supporting the economy. The public debt-to-GDP ratio rose from an average of 41.8% during 2015–2019 to 61.1% in the post-COVID period (2021–2024), and the current medium-term fiscal framework (Cabinet, 2025) projects the ratio to approach its statutory ceiling of 70%. The IMF and international credit rating agencies have warned that Thailand faces an increased risk of a sovereign credit downgrade, which would raise borrowing costs for both the public and private sectors. This situation is not surprising, as the government has operated under persistent fiscal deficits for more than two decades, with the deficit widening from an average of −2.6% of GDP per year during 2015–2019 to −4.1% per year in the post-COVID period (2021–2024).

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Looking ahead, the country faces heightened political risks arising from competition between populist policy agendas and expanding welfare-state commitments, which could further undermine fiscal discipline. Comprehensive fiscal reform is therefore essential to safeguard Thailand’s long-term macroeconomic stability.

Household Debt

Thailand is one of the countries with very high household debt. Notably, many countries with high household debt are high-income economies (Ishak, 2026), such as Switzerland (125% of GDP), Australia (112% of GDP), Canada (100% of GDP), and the Netherlands (94% of GDP). In contrast, Thailand’s household-debt-to-GDP ratio is unusually high for a developing economy, standing at around 84% of GDP before COVID-19 and rising to around 90% after COVID-19. Among developing peers, Malaysia is the closest comparator, with household debt of around 70% of GDP, which is still significantly lower than Thailand’s level.

High household debt constrains economic growth through the consumption channel. Highly indebted households must allocate a large share of their income to debt repayment before consumption, reducing aggregate demand. In addition, high debt burdens can prevent households from expanding economic activities or investing to increase future income, trapping some households in persistent vulnerability or poverty.

Household debt can be reduced gradually over time through economic growth (base-effect reduction) and debt-restructuring or relief programs, typically offered by lenders, the Bank of Thailand, and the government. However, such adjustment processes often take a long time. Even so, targeted debt-support programs can generate positive macroeconomic effects, as they help revive consumption and create multiplier effects throughout the economy.

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Goods-Exporting Sector

Before this point, the factors discussed are primarily internal factors that serve as the backbone of the economy. The remaining factors are external factors that inject income into the system, among which the goods-exporting sector plays a central role. Based on Trademap database, during 2015–2019, Thailand accounted for roughly 1.3% of global exports. After COVID-19, this share declined slightly to 1.2% during 2021–2024.

Looking ahead, however, the global trade environment has changed markedly. The United States has introduced reciprocal tariff measures that apply to a broad range of imported goods, under which Thailand faces a tariff rate of 19% (USTR, 2025). Although this rate is broadly comparable to those imposed on competing exporting countries, the tariffs nonetheless impose significant cost pressures that cannot be easily passed on to U.S. consumers.

Moreover, the emerging trade regime is increasingly shaped by strategic competition between the United States and China, placing Thailand in a vulnerable intermediary position. According to Trademap database, Thailand’s combined export share to the U.S. and China increased from 23.2% during 2015–2019 to 29.3% during 2021–2024, while imports from these two countries rose from 27.3% to 30.8% over the same period. This rising dependence heightens Thailand’s exposure to economic shocks arising from bilateral trade conflicts.

A clear example of this vulnerability is Thailand’s role as a transshipment hub for Chinese products. In 2025, the United States imposed final tariff rates on solar panels and components originating from Thailand, ranging from approximately 375% to 972%, significantly increasing the cost of Thai exports to the U.S. market.

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A new export enhancing strategy is therefore needed to protect the country under this new global trade order and to guide the goods-exporting sector forward.

Foreign Direct Investment

Foreign direct investment (FDI) has long served as a foreign-driven engine of investment and growth for Thailand. Notably, Japanese investment in major industries—including automotive, electrical appliances, and electronics—has not only generated large-scale employment (including jobs in related and upstream industries) but has also supported the development of local supply chains and contributed significantly to the broader local economy.

In the post–COVID-19 period, however, the composition of FDI has begun to shift (Suleesathira, 2025). Thailand has transitioned from an investment landscape dominated by Japanese firms toward one increasingly shaped by Chinese conglomerates and data center investments. These new forms of investment differ substantially from earlier FDI patterns. First, Chinese firms tend to rely more heavily on their own workers and supply chains, limiting spillovers to local labor and suppliers. Second, data center investments fewer opportunities for local supply chain development.

As a result, although headline FDI inflows have continued to rise and recently reached new record levels, it is unclear whether Thailand’s economy will benefit to a similar extent as in the past. In practice, the primary beneficiaries may instead be industrial estate developers and utility providers servicing these investments. Moreover, growing competition for limited resources—particularly utilities—has emerged as an additional concern, as new FDI projects may crowd out more labor-intensive and supply-chain-rich forms of investment that have traditionally generated broader economic benefits.

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A balanced approach is therefore required—one that carefully weighs the gains from both traditional and new forms of FDI, while ensuring that Thai workers and local supply chains remain integral parts of the investment equation.

Tourism Sector

The tourism sector is a major contributor to Thailand’s GDP. At its peak in 2019, Thailand welcomed nearly 40 million international visitors, with tourism contributing around 10% of GDP (World Travel and Tourism Council, 2024).

However, even in 2025, the number of international visitors has not yet returned to its 2019 level. Estimated arrivals remain at around 33–34 million visitors. Two developments are particularly concerning.

First, Thailand continues to rely heavily on traditional tourism assets, including mountains, beaches, sunshine, and cultural heritage sites. These strengths have long positioned Thailand as one of the world’s most visited destinations. Nevertheless, after decades of offering largely similar experiences, many destinations now face overcrowding, rising prices, environmental degradation, tourist scams, and “tourist traps.” Policy choices have also contributed to these challenges, including the legalization of cannabis, which has affected Thailand’s tourism image in some markets.

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Second, regional competitors have not remained static. Countries such as China, Japan, and Vietnam have actively upgraded and promoted their tourism sectors by introducing new attractions and differentiated experiences. Compounding these pressures, the strength of the Thai baht has placed Thailand at a cost disadvantage, making travel expenses approximately 4–10% higher than those of peer destinations.

To revitalize the tourism sector, it is imperative to reinvigorate the visitor experience. Thailand must preserve the qualities that once defined its appeal—friendliness, hospitality, local character, and a sense of joy—while simultaneously developing new sources of excitement, including well-designed man-made destinations, to compete more effectively with regional peers.

Services-Importing Sector

The services-importing sector functions as a leakage from the economy, capturing expenditures by local residents on services provided outside the Thai economy. It includes travel services, business services (trade-related, professional, and management consulting), transport, financial services, government goods and services, telecommunications, computer and information services, the use of intellectual property, construction services, and insurance and pension services.

In analyzing the external services sector, it is useful to compare services imports with services exports (Tables 1 and 2). During the periods 2015–2019 and 2021–2024, a sharp contrast emerged between these two sectors. While the services-exporting sector declined from an average of USD 70,297 million to USD 48,282 million, the services-importing sector increased from an average of USD 48,898 million to USD 64,847 million.

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As a result, Thailand has shifted into a negative external services balance vis-à-vis the rest of the world. More disaggregated statistics show that Thailand’s major service exports are concentrated in travel, business services (primarily trade-related), and transport, which together account for approximately 95 percent of total service exports. In contrast, service payments have been rising in transport, business services, intellectual property rights, insurance and pension services, financial services, telecommunications, computer and information services, and personal, cultural, and recreational services. Looking ahead, the services-exporting sector remains heavily dependent on relatively stagnant activities, namely travel (linked to tourism), business services (linked to goods exports), and transport (linked to both tourism and goods exports)—all of which face limited growth prospects. Meanwhile, services-importing sectors are growing rapidly in popularity among Thai consumers and businesses, particularly in ride-hailing and food delivery, accommodation platforms, e-commerce marketplaces, mobile app stores, streaming and digital content services, and cloud and IT services. Without policy intervention, the negative balance in services trade is likely to widen further.

External Threats

Last but not least, looking ahead, several external threats could have a significant impact on the economy and overall GDP. One such threat is global warming. Climate-related disasters not only cause premature deaths but also generate substantial economic losses. In recent years, Thailand has experienced an increasing number of extreme events, many of which have set new records. For example, the severe flooding in Hat Yai was caused by an unprecedented rainstorm, the heaviest in more than 300 years (Pasutan, 2025). Similarly, the earthquake in 2025, which was clearly felt in Bangkok. It is a once in a lifetime for most Bangkok’s residents.

Other catastrophic events, whether natural or man-made, cannot be ruled out in the future. Countries that are well prepared for such shocks are better positioned to preserve economic stability and protect their citizens from the unforeseen hardships these events may impose. 

Conclusion

   This article compiles empirical evidence and statistical data to diagnose Thailand’s economic growth slowdown. The findings suggest that the deceleration is not driven by a single factor, but rather by simultaneous deterioration across ten structural dimensions, collectively producing a systemic weakness. This dynamic can be likened to the human body, which may withstand isolated health issues to some extent, but becomes critically ill when multiple conditions occur concurrently.

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The article also outlines broad policy directions for addressing each structural challenge, emphasizing that problem recognition and appropriate strategic orientation are essential first steps toward effective reform. However, given space limitations, the article does not provide detailed policy prescriptions for each area. More comprehensive solutions are discussed in the referenced literature, alongside additional policy proposals that have long been debated within academic and policy circles.

References

Bisonyabut, N., & Tantisan, W. (2025). Tracking Thailand’s economic growth: Past, present and future. TDRI Quarterly Review, 40(3), 2–9.

Cabinet. (2025). Revised Medium Term Fiscal Framework (MTFF).

Hermayurisca, F., & Taneepanichskul, N. (2023). Estimation of premature death attributed to short- and long-term PM2.5 exposure in Thailand. Environmental Monitoring and Assessment, 195(10), 1176. https://doi.org/ 10.1007/s10661-023-11807-4

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Ishak, I. (2026, January 30). Ranked: The 35 countries with the highest household debt. Visual Capitalist. https://www.visualcapitalist. com/cp/35-countries-with-highest-household-debt/

Kosako, J. (2025, December 23). Voices from Hat Yai in the wake of the flood crisis [เสียงจากหาดใหญ่ หลังวิกฤตน้ำท่วม]. Business Voices, No. 2. https:// www.bot.or.th/th/research-and-publications/ research/business-voices/business-voices-2025-12.html

National Economic and Social Development Council. (2025). Capital stock of Thailand, 2024 edition.

Pasutan, P. (2025, November 24). What does Hat Yai’s “heaviest rainfall in 300 years” actually mean? [ฝนตกหาดใหญ่ “หนักสุดในรอบ 300 ปี” หมายความว่าอย่างไร?] ThaiPBS. https://www. thaipbs.or.th/now/content/3403

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PISA. (2022). Press conference: results of the PISA 2022 Assessment [การแถลงข่าวผลการประเมิน PISA 2022]. https://pisathailand.ipst.ac.th/news-21/

Prachatai. (2019). TDRI recommends strategies to cope with an aging society: invest in human resources, reduce military service requirements, increase automation, and develop cities. [TDRI แนะรับมือ ‘สังคมอายุยืน’ ลงทุนมนุษย์-ลดเกณฑ์ทหาร-เพิ่มระบบอัตโนมัติ-พัฒนาเมือง]. https://prachatai. com/journal/2019/05/82475

Suleesathira, P. (2025, September 16).  In-depth analysis: Why investment in the Eastern region fails to improve the lives of local people [เจาะลึก: ทำไมเม็ดเงินลงทุนภาคตะวันออกไม่ทำให้คนในพื้นที่ดีขึ้น] Bangkokbiznews. https://www.bangkokbiz news.com/business/economic/1198863

Thailand Development Research Institute. (2025a). Silver economy.

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Thailand Development Research Institute. (2025b). Reimagining Thailand’s development’s model. https://tdri.or.th/2025/09/tdri-annual-public-conference-2025/

United States Trade Representative. (2025). Fact sheet: The United States and Thailand reach a framework for an agreement on reciprocal trade. https://ustr.gov/about/policy-offices/ press-office/fact-sheets/2025/october/fact-sheet-united-states-and-thailand-reach-framework-agreement-reciprocal-trade

World Travel and Tourism Council. (2004). Travel & tourism economic impact research (EIR). https://wttc.org/research/economic-impact/

Author: Nonarit Bisonyabut, Ph.D. and Sunan Phumkham.

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Moody’s ​Ratings on Tuesday revised its outlook ​on U.S. business development companies (BDCs) to negative from stable, ​citing rising redemption pressures, higher leverage and weakening access to funding markets.

The pressure falls most acutely on non-traded BDCs, which account for more than 60% of the sector.

A broad ‌swath of these ⁠funds ⁠recorded their first-ever outflows at the start of this year as wealthy individuals and other key ​buyers redeemed their holdings, a sharp reversal from 2025, when inflows had been “very robust” ​as recently as the third quarter, Moody’s said.

The outflows leave those non-traded funds “more on defense when it comes to deploying additional capital until the current market ​shift and uncertainty resolve,” the ratings agency said.

The ⁠non-traded funds ‌raise equity and pair it with leverage to lend ​to private ​companies, structured to continuously raise capital while offering limited, periodic ⁠liquidity to investors.

Funding conditions deteriorated further, with BDCs pulling back ​from the unsecured bond market as spreads widened, ​Moody’s added.
Michael Covello, executive managing director at specialized investment bank RA Stanger, said the BDCs appeared to have sufficient liquidity to meet near-term needs.”I don’t know that liquidity is an issue as of today,” Covello said. “Long term that could be a different story based on macro events, how their portfolios ‌are constructed and overall net flows.”

Moody’s also flagged emerging risks from artificial intelligence to BDCs’ large exposure to software companies, which account ​for roughly a ​quarter of portfolios.

Though ⁠executives dismissed those concerns as overblown, investors remain on edge. Asset quality remains stable for now, but the agency expects credit performance to weaken as technological disruption ​unfolds.

BDCs, which lend to many of the same middle-market borrowers as private credit funds, serve as an early barometer of stress in the sector.

The outlook could return to stable if redemption pressures ease, leverage remains contained and asset quality risks moderate, Moody’s said.

As President Donald Trump’s deadline for Iran to reopen the Strait of Hormuz looms, gas prices are continuing to climb nationwide as the conflict drives up crude oil costs.

The Strait of Hormuz, a narrow waterway between Iran, the United Arab Emirates and Oman, is one of the world’s most critical energy choke points.

Fuel costs are rising as Trump issued a profanity-laced warning to Iran, giving the regime until Tuesday, 8 p.m. ET to allow vessels through the key waterway – or face strikes on its critical infrastructure.

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The national average now stands at $4.13 per gallon, up about 89 cents from a month ago, according to AAA. Costs are climbing across nearly every region, with some states already well above the U.S. average.

On the West Coast, drivers are seeing the highest costs, with prices reaching $5.93 per gallon in California and $5.39 in Washington. 

Meanwhile, on the East Coast, gas prices have surpassed $4 in several areas, including $4.28 in Washington, D.C., and $4.10 in New York. 

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In the Midwest, Illinois stands out at $4.36 per gallon, while much of the region remains in the mid-$3 range. Southern states remain comparatively cheaper, though prices are rising there as well. Texas and Alabama are averaging $3.84, while Florida is higher at $4.18.

Diesel has climbed to $5.64, up about $1.13 over the past month. As a key fuel for freight, shipping and public transportation, it is especially sensitive to supply disruptions.

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In San Francisco, prices have surged even higher. For the first time on record, average diesel costs have surpassed $8 per gallon, according to new data from GasBuddy – marking an unprecedented milestone for any U.S. city.

The surge underscores the broader economic risks tied to the standoff, as uncertainty around the Strait of Hormuz continues to weigh on energy markets.

Market regulator Securities and Exchange Board of India (Sebi) has announced a one-time relaxation for listed companies struggling to meet Minimum Public Shareholding (MPS) norms, citing challenging market conditions driven by ongoing geopolitical tensions in the Middle East.

Sebi’s relief comes following representations from industry bodies highlighting the difficulties in achieving compliance amid volatile markets. The regulator has decided to ease these provisions temporarily.

The relaxation takes effect immediately, with stock exchanges instructed to notify listed entities and make necessary amendments to their rules and regulations to implement the directive.

Under existing rules, companies that fail to comply with MPS requirements face penal actions such as fines, freezing of promoter shareholding and other restrictions as outlined in Sebi’s master circular on listing obligations.

Sebi said that listed entities whose deadlines for meeting MPS norms fall between April 1, 2026 and September 30, 2026 will be exempt from penal actions during this period. Stock exchanges and depositories have been directed not to initiate any punitive measures against such companies. Additionally, any penalties already imposed for non-compliance during this window will be withdrawn.

The move comes as heightened uncertainty and subdued investor participation have made it difficult for companies to dilute promoter holdings and raise public shareholding to mandated levels.
Earlier today, Sebi provided relief to companies planning to tap the capital markets by granting a one-time extension for the validity of its observation letters, citing challenging market conditions due to ongoing geopolitical tensions in the Middle East.Under existing norms, companies are required to launch their public issues within 12 to 18 months from the date of receiving SEBI’s observations. However, the regulator noted that issuers are facing difficulties in mobilising funds and accessing capital markets amid subdued investor participation and heightened uncertainty.

Read more: Sebi grants one-time extension for IPO observation validity amid geopolitical volatility

(Disclaimer: The recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times.)

Goldman Sachs on Tuesday sold over 13.82 lakh equity shares in Cello World Limited via a bulk deal worth Rs 55 crore. The shares were sold at a price of Rs 401 apiece by its affiliate Goldman Sachs Funds.

Goldman Sachs Funds – Goldman Sachs India Equity Portfolio held over 29.51 lakh equity shares in the company, representing a 1.34% stake.

Shares of Cello World Limited remained largely steady on Tuesday even as a bulk deal took place in the counter. The stock ended at Rs 404, up Rs 2.20 or 0.55% from Monday’s closing price.

Goldman Sachs’ stake sale follows significant underperformance by the stock over the past year. Its share price has eroded by 24% in this period, while the Nifty and the BSE Sensex have traded flat.

The stock is currently trading below its 50-day and 200-day simple moving averages (SMAs) of Rs 446 and Rs 551, respectively, according to Trendlyne data.

Cello Plastic Industrial Works commenced offering plastic houseware products under the Cello brand in 1982. The company owns and operates 13 manufacturing facilities across five locations in India.
Cello World’s December quarter delivered a weak set of numbers, posting a consolidated net profit of Rs 64 crore, a 26.3% growth year-on-year. The company had reported a profit after tax (PAT) of Rs 86 crore in the year-ago period.The total revenue in the quarter under review stood at Rs 570 crore, flat compared with Rs 569 crore in the corresponding quarter of the last financial year.

Also read: Goldman Sachs picks stakes in Jio Financial, BHEL via block deals. Check sellers

(Disclaimer: The recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times.)

Shares ​of U.S. health insurers climbed on ​Tuesday after the government set Medicare Advantage payment rates ​above expectations, an increase that would result in more than $13 billion in additional payments in 2027. Insurers had lost billions in market value after the Trump administration’s smaller-than-expected January ‌proposal sparked backlash ⁠from ⁠an industry already grappling with significant financial strain.

Shares of UnitedHealth jumped more than 10%, ​CVS Health nearly 7%, while Humana gained 8% and Elevance Health added 3%. The Centers for ​Medicare & Medicaid Services said late on Monday it would raise payments to private insurers offering Medicare Advantage plans to older adults in 2027 by ​2.48% on average, much higher than the smaller-than-expected ⁠0.09% rate ‌increase that was proposed in January.

“This improvement should allow ​the industry ​to expand margins in 2027 when coupled with benefit ⁠cuts,” said Mizuho analyst Ann Hynes.

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Investors had expected ​a rate increase of at least 1%, Wall Street analysts ​had said earlier.

“This elevates the case for some margin growth in 2026 and lessens the growing perception that CMS’ harsh policy stance on the group is worsening,” said Leerink analyst Whit Mayo.
“At minimum, the sector will be perceived to be more investable.”Health insurers had argued ‌the disappointing rates proposed in January did not reflect the reality of rising medical costs, which have been squeezing industry ​margins for ​nearly three years.

“The industry ⁠has continued to face a tough environment, but on the heels of this more favorable release, we might be seeing the tide changing,” Oppenheimer analyst ​Michael Wiederhorn said.

Insurers would also get a 2.5% benefit from a change to risk assessment payments related to health status, for a total increase of about 5%, a Medicare agency official said on Monday in a call with media.

American consumers who are in the market for used cars are facing the highest prices in nearly three years, according to a new report.

Wholesale prices for used vehicles rose to their highest level since the summer of 2023 in March, with the Manheim Used Vehicle Value Index rising 6.2% year over year to a reading of 215.3.

Data from Manheim, a Cox Automotive brand and the largest wholesale marketplace in the U.S., found that demand for used vehicles remains strong. Values rose 1.4% in the month of March, which the report noted is well above long-term norms, and are up 2.3% from the start of 2026.

“As soon as this year began, prices at Manheim started moving higher as dealers anticipated strong demand from higher tax refunds to consumers,” said Jeremy Robb, chief economist at Cox Automotive.

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“Sales conversion rates, a clear sign of demand, were higher against 2025 for every week but one in Q1, and vehicle value trends at auction show we are well ahead of last year and where we would normally be during a spring bounce in the wholesale markets,” Robb added. 

“We thought we’d see some impact from the Middle East conflict, and that may still happen. But right now, the data is clear: used-vehicle demand is healthy and inventory levels are relatively tight,” he added.

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The Manheim report found that buyer activity was strengthening and there was increased competition for the available inventory in the wholesale lanes, as the sales conversion rate rose to 68.2% in March. That’s 4.6 percentage points higher than the most recent three-year average for March and is up 5.5 percentage points from the revised-higher February rate of 62.7%.

Used electric vehicles (EVs) also showed strength in the first quarter with firm pricing and activity for the quarter as values rose alongside the seasonal increase. 

It noted that used EVs offer consumers affordability advantages over new EVs, while there’s also an increasing flow of off-lease EVs entering wholesale channels.

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Retail used vehicle sales also showed momentum, with first quarter sales up about 2% compared with the same level a year ago. Inventory also tightened, with the days’ supply metric declining below 40 in March, which was the lowest point this year and down from a year ago.

Cox Automotive’s outlook for 2026 sees used vehicles continuing a stronger-than-expected start to the year, before being offset by a softer second half of 2026 with total used vehicle sales declining 1% year over year.

“As we move towards summer, we expect Manheim values to hold their ground with many more consumers yet to file their tax returns this year,” Robb said.

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“The end of March typically proves to be the ‘peak’ for price action at Manheim. The Middle East conflict could dampen the spirits of the U.S. consumer, but we just haven’t seen it yet – our data is showing resiliency in the economy,” Robb said.