THIRUVANANTHAPURAM l saturday l june 06, 2026 l `9.00 l PAGES 16 l late city EDITION Worried anthropic suggests global freeze on ai development The largest AI company by market capialisation warned that the technology is improving so quickly there’s a risk humans would lose control recursive self-improvement a threat pause to enable alignment research Given enough computing power, an AI system could be able to design and develop its own successor, known as “recursive self-improvement”. Self-building AI would be a major technological milestone that would bring benefits in science, healthcare and other areas, Anthropic said, but it “also might increase the risks of humans losing control over AI systems” ■ ■ Anthropic’s post comes after a warning this week from researchers at University of Toronto who showed how AI tools could be used to create a new kind of AI “worm” that adapts its hacking strategy Anthropic researchers said the pause would enable “societal structures and alignment research” to keep up with AI advances | P10 $ 1 trillion could be anthropic’s worth after its forthcoming ipo CHENNAI ■ MADURAI ■ VIJAYAWADA ■ BENGALURU ■ KOCHI ■ HYDERABAD ■ VISAKHAPATNAM ■ COIMBATORE ■ KOZHIKODE ■ THIRUVANANTHAPURAM ■ BELAGAVI ■ BHUBANESWAR ■ SHIVAMOgGA ■ MANGALURU ■ TIRUPATI ■ TIRUCHY ■ TIRUNELVELI ■ SAMBALPUR ■ HUBBALLI ■ DHARMAPURI ■ KOTTAYAM ■ KANNUR ■ VILLUPURAM ■ KOLLAM ■ TADEPALLIGUDEM ■ NAGAPATTINAM ■ THRISSUR ■ KALABURAGI Rollicking GDP before war pain 6.6 Data shows better than expected expansion of the economy in the last financial year. Economic strain expected to be captured in Q1, FY27 8.3 7.6 Q1 7.5 7.5 7.1 7.0 6.6 GDP Growth Rate (%) Q2 Q3 2023-24 7.8% Economy expansion in January-March quarter, exceeding forecasts 8.0 7.4 Q4 Q1 8% Q2 Q3 2024-25 7% Growth in third quarter in FY26 Q4 7.7% Expansion of the economy a year ago Real GDP estimated to reach J323.12 lakh crore in 2025-26, against the First Revised Estimate of GDP for 2024-25 of J299.89 lakh crore 6.8 Q1 Full-year growth, up from 7.1% in FY25 Impact of Iran war to be visible in the current April-June quarter 7.8 Q2 Q3 2025-26 Q4 7.9% Growth in gross value added (GVA) in Q4. GVA removes volatile components like indirect taxes and subsidies to capture economic activity Nominal GDP or GDP at current prices is estimated at J346.36 lakh crore in 2025-26, against J318.07 lakh crore in 2024-25. Growth rate: 8.9% tax axe to heal Capital gains levy chucked to draw foreign investors RBI expects 5.1% inflation, keeps rates unchanged D i pa k M o n d a l @ New Delhi D i pa k M o n d a l @ New Delhi After days of speculation, the government on Friday bit the bullet and announced tax relief for foreign investors. It took the ordinance route to grant exemptions on interest income and capital gains earned from investments in government securities by Foreign Institutional Investors (FIIs). However, no relief was extended to investments in equities. Hours later, the Reserve Bank of India (RBI) unveiled a slew of measures aimed at attracting foreign capital. Together, these steps are expected to support the rupee, which has been under pressure in recent months. The ordinance amends the Income-tax Act, 2025 to exempt interest earned on government securities, as well as capital gains arising from their sale, exchange or transfer, from income tax for FIIs, subject to the furnishing of prescribed information to tax authorities. It takes effect retrospectively from April 1, 2026. At present, FIIs or Foreign Portfolio Investors (FPIs) face a 20% withholding tax on interest income earned from Indian debt securities, including government bonds and rupee-denominated bonds. Long-term capital gains on government securities are currently taxed at 12.5%, while short-term capital gains attract a 20% tax. The tax relief is expected to make government bonds attractive for foreign investors at a time when India is seeking deeper integration with global debt markets. Rajesh H Gandhi, Partner, Deloitte India, said the tax exemption would increase returns for FPIs investing in Indian government securities by 15-20% and improve the return differential between Indian sovereign bonds and those of other countries, making India more attractive to global investors. As for the RBI, it expanded the universe of securities eligible under the Fully Accessible Route (FAR) by including all new issuances of 15-year, 30-year and 40-year government bonds. In another significant relaxation, it increased investment limits for NRIs and Overseas Citizens of India in listed equity instruments without requiring registration with the Securities and Exchange Board of India. RBI’s measures, along with tax benefits provided by the govt this morning, should help attract foreign capital for govt borrowing Sanjay Malhotra, RBI guv Neutral policy stance While retaining the MPC’s “neutral” policy stance, the RBI said future monetary policy decisions would depend on how inflationary pressures evolve Equity markets disappointed There was disappointment in the equity market as the government announced no tax relief for equity investments. Benchmark indices ended in the red Ordinance route The government said the ordinance was necessary as Parliament is not in session and circumstances required immediate action The Reserve Bank of India (RBI) on Friday sprung no surprises, keeping the repo rate unchanged at 5.25%, even as it acknowledged that global economic conditions had deteriorated amid the continuing conflict in West Asia. The central bank lowered its growth forecast for FY27 to 6.6% from 6.9% and raised its inflation projection to 5.1% from 4.6%, citing rising energy prices, supply-chain disruptions and heightened geopolitical uncertainty . Announcing the Monetary Policy Committee’s (MPC) decision, RBI Governor Sanjay Malhotra said the global environment had worsened since the previous policy review, with the ongoing conflict exerting pressure on commodity prices and disrupting supply chains. The RBI now expects India’s GDP growth to moderate to 6.6% during the current financial year — down from 7.7% in FY26 — reflecting the impact of higher input costs and weaker global demand. “The rise in prices of energy and other inputs, coupled with supply disruptions, is likely to weigh on economic activity,” the governor said, adding that prolonged geopolitical uncertainty could delay supply-chain normalisation and increase costs for businesses. Despite the downward revision, the RBI maintained that the domestic economy remains resilient. Private consumption continues to be supported by discretionary spending, investment activity has retained momentum, and both manufacturing and services sectors continue to expand. Merchandise exports recorded robust growth in April despite elevated freight and insurance costs, while services exports remained strong. The central bank, however, cautioned that downside risks to growth remain significant due to volatile commodity prices, financial market uncertainty supply-chain disruptions , and weather-related factors. At the same time, the RBI raised its inflation forecast for FY27 to 5.1% from 4.6%, reflecting the sharp increase in global crude oil and other commodity prices. Annamalai quits BJP, joins race for 2031 TN elections E x p r e s s N e w s Se r v i c e @ Chennai EXPRESS READ State braces for heavy rain today, tomorrow T’Puram: With the monsoon strengthening in the state, the IMD has issued red alerts in various districts. It has warned of extremely heavy rain in isolated parts of the state on Saturday and Sunday. P4 16 pages, including 4 pages of THIRUVANANTHAPURAM Express The BJP on Friday announced the resignation of former Tamil Nadu BJP president K Annamalai — known for his aggressive style and fierce anti-Dravidian politics — from its primary membership. A few hours later, the ex-IPS officer converted ‘We The Leaders’, a youthbased volunteer outfit launched by him in 2020, into a political movement and declared his intention to fight the 2031 Assembly polls in the state. Annamalai’s 25-minute online speech on his political future on Friday afternoon gained the attention of over 55 lakh people across multiple social media platforms. Positioning his movement as a platform to groom a new generation of political leaders, Annamalai also declared the plan to launch ‘APJ Abdul Kalam Centre for Ethics and Politics’ in Coimbatore with the motto “let us be the change to bring change” to train aspiring leaders for public life and electoral politics. The movement would evolve into a full-fledged political party after building and training a cadre base, he said, adding that those trained at the centre will be fielded in next local body polls. He said the movement would embrace the “politics of the soil” and bring people from all walks of life, particularly technocrats, into politics. It would be rooted in Tamil identity with a national outlook, he said. Projecting himself as a common man’s politician, Annamalai, in an apparent reference to Vijay-led TVK, said TN must move away from cult politics. “We should ensure honest and capable leadership from the ward level upwards to deliver clean politics and governance,” he said. HC dismisses CMRL plea, clears way for ED probe First trouble: K’taka minister quits in a huff E x p r e s s N e w s Se r v i c e @ Kochi E x p r e s s N e w s Se r v i c e @ Bengaluru The Kerala High Court on Friday cleared the way for the Enforcement Directorate (ED) to continue its investigation into alleged illegal payments made by Cochin Minerals and Rutile Limited (CMRL) to Exalogic Solutions, the IT firm owned by T Veena, daughter of former chief minister Pinarayi Vijayan. Dismissing the appeals filed by CMRL and its officials challenging the ED probe, a division bench comprising Justices Raja Vijayaraghavan V and K V Jayakumar upheld an earlier singlejudge ruling that permitted the investigation to proceed. The CMRL argued that the registration of an Enforcement Case Information Report (ECIR), in the absence of a crime or complaint registered by a competent jurisdictional authority was legally unsustainable. , The court held that the absence of an FIR or a complaint related to a scheduled offence does not prevent the ED from initiating civil proceedings under the Prevention of Money Laundering Act (PMLA). It clarified that registration of a scheduled offence is mandatory only for criminal prosecution under Section 3 of the Act, and not for civil actions such as attachment of properties under Section 5 or inquiries conducted under Section 50. Rejecting the plea to quash the ECIR, the bench observed that the ECIR is not Director reviews inquiry Kochi: With the HC giving its green signal, the ED is set to intensify its probe into the CMRL-Exalogic financial dealings, said sources. ED director Rahul Navin on Friday reviewed the progress of probe in the case during a high-level meeting in Kochi. Sources said the agency is planning to question more persons linked to the alleged financial deals involving CMRL and Exalogic. P4 a statutory document and that even its non-registration would not hinder the commencement of civil proceedings under the PMLA. Consequently, the court found no grounds to interfere with the earlier judgment dismissing CMRL’s petition. Following the verdict, counsel for CMRL sought two weeks of protection from coercive action to enable the company to approach the Supreme Court. The bench, however, declined the request, stating that such relief could not be granted. The ED had earlier issued summons to CMRL officials under provisions of the PMLA. In their appeal, the company and its officers argued that the agency lacked jurisdiction because no FIR or complaint relating to a scheduled offence existed when the ECIR was regis● More on P4 tered.  IN a major embarrassment for the new Congress government, Water Resources Minister Ramalinga Reddy resigned Friday less than 24 hours after , portfolios were allocated, upset at not receiving the Bengaluru Development portfolio h e s ay s h e w a s t w i c e promised. Reddy, an eight-time MLA from BTM Layout, said Chief Minister D K Shivakumar had personally assured him the portfolio, which ultimately went to Krishna Byre Gowda. In his resignation letter, Reddy said accepting the allocation went against his conscience, adding he would continue to work as an MLA and Congress worker. Shivakumar acknowledged his promise but said the decision on portfolios was taken by the high command. Senior minister K H Muniyappa also voiced displeasure at being re-allocated the Food and Civil Supplies department. However, after a conversation with Rahul Gandhi, Muniyappa said he was happy to accept the party’s decision.