"Warning of 'Painful' Budget Shakes Public Confidence"

Deepshikha Maan, Jadetimes Staff

D. Maan is a Jadetimes news reporter covering Asia

---

Image Source : AFP

Sharp Decline in Consumer Confidence Amid Concerns Over Upcoming Budget

A long standing measure of consumer confidence in the UK has shown a sharp decline, raising alarms that the government’s warning of a "painful" Budget has negatively impacted public sentiment. GfK's Consumer Confidence Barometer dropped further into negative territory after previously recovering from the challenges of the Covid 19 pandemic, inflation, and rising interest rates.

Economic Outlook Worsens

GfK reports that the latest confidence index does not offer "encouraging news" for the new government. Some economists are linking the drop in consumer confidence to Labour leader Sir Keir Starmer's warnings of a challenging Budget on 30 October, which could include tax increases and spending cuts. Announced plans to means-test winter fuel payments will affect over nine million pensioners who may no longer receive up to £300 this winter.

Business Concerns Over Confidence

Business leaders, including Richard Walker, head of Iceland, have expressed concerns about the negative projections of the upcoming Budget. They argue that talk of tax increases and stricter employment regulations has already impacted confidence in the UK's business environment. The Institute of Directors (IoD) also notes a dent in business sentiment.

Consumers Hesitant on Big Purchases

GfK highlighted a significant drop in consumer perceptions of both the general economic situation and their personal financial outlook, with the index on future personal finances falling by nine points. Consumers are also now more hesitant to make large purchases, and overall confidence has dropped by seven points, landing at 20.

The Role of Government Warnings

Retailers like Nick Glynne of Buy It Direct Group have attributed the drop in consumer demand to the government's budget warnings, claiming a 9% decrease in online traffic since the negative announcements. Glynne speculated that government projections might be overstated to manage expectations, hoping for a more favorable outcome after the Budget.

Unexpected Decline Despite Economic Easing

This drop in consumer confidence comes despite a recent interest rate cut by the Bank of England, which lowered borrowing costs and eased some pressure on households. Inflation has also stabilized at 2.2%, close to the Bank’s 2% target. However, GfK’s director of consumer insights, Neil Bellamy, noted that despite these positive developments, the looming withdrawal of winter fuel payments and expected fiscal challenges have left consumers nervous.

Challenges Facing the Government

Chancellor Rachel Reeves acknowledged the dip in confidence but remains optimistic, citing strong business confidence in the UK economy and the government's goal to "unlock the country's potential." However, the government continues to face a £22 billion shortfall in public finances, partly due to above inflation public sector pay deals.

Former Sainsbury’s CEO Justin King suggested that the government might be preparing the public for bad news, so the actual Budget feels less severe. This strategy, he argued, is often used in business turnarounds to manage expectations.

Economic Growth Stagnates

The UK economy stagnated in July, dealing a blow to the government's goal of boosting economic growth. The Bank of England revised its growth forecast for the third quarter from 0.4% to 0.3%. Bank of England Governor Andrew Bailey stated that while consumer confidence is slowly improving, people need sustained evidence of economic recovery.

Retail Sector Sees a Glimmer of Hope

Despite the bleak outlook, retail sales saw a slight improvement in August, rising by 1%, thanks to warmer weather and end of season discounts. However, the overall economic picture remains fragile.

Government Plans to Restore Confidence

The Treasury has been "honest about the state of public finances" inherited from the previous administration. While outlining the nation's strengths in renewable energy and services, the government is expected to present a more positive economic vision at the Labour Party’s conference and an upcoming investment summit. Nonetheless, the message remains clear: the Budget will involve tax rises, cuts to welfare, and reductions in government spending.

Microsoft Selects Notorious Nuclear Site to Power AI Operations

Deepshikha Maan, Jadetimes Staff

D. Maan is a Jadetimes news reporter covering US

---

Image Source : Andrew Caballer-Reynolds/AFP

Microsoft to Reopen America's Infamous Three Mile Island Nuclear Plant for AI Energy Needs

The Three Mile Island energy plant, site of the most significant nuclear accident in U.S. history, is set to reopen as Microsoft addresses its growing demand for power. The tech giant has signed a 20 year agreement to purchase energy from the Pennsylvania based plant, which is scheduled to restart in 2028 after undergoing upgrades.

A Clean Energy Initiative for AI Expansion

Microsoft’s agreement aims to secure a sustainable energy source to support its expanding AI data centers, which require large amounts of power. The plan, which must now go through regulatory approval, marks a significant step in the company’s efforts to source clean energy.

Constellation Energy's Role in the Reopening

Constellation Energy, the current owner of the plant, confirmed that the reactor set to restart is located next to, but remains independent of, the unit involved in the 1979 accident. The original incident caused no injuries or deaths but generated widespread public fear, hindering nuclear power development in the U.S. for decades.

With rising concerns over climate change and increasing energy demands from AI, nuclear energy is gaining renewed attention. Constellation’s CEO, Joe Dominguez, stated that the agreement symbolized the "rebirth of nuclear power as a clean and reliable energy resource."

A Symbol of Nuclear Energy’s Revival

Dominguez highlighted that prior to its closure due to economic factors, the plant was one of the safest and most reliable nuclear facilities. He expressed enthusiasm about reopening it under a new name and mission, emphasizing that nuclear plants are among the few energy sources capable of consistently delivering abundant carbon-free electricity.

Long Term Vision and Economic Benefits

Microsoft views the partnership as a milestone in its strategy to contribute to grid decarbonization. Constellation plans to invest $1.6 billion to modernize the plant, seeking approval to keep it operational until at least 2054. The plant’s reopening is expected to create 3,400 jobs and contribute over 800 megawatts of carbon free energy to the grid. According to a study by The Brattle Group, the project could also generate billions in taxes and economic benefits.

Historical Context: The 1979 Three Mile Island Incident

On March 28, 1979, the Three Mile Island plant experienced a partial meltdown due to a combination of mechanical failure and human error. The accident occurred in Unit 2, but Unit 1, which Microsoft plans to utilize, continued to operate until 2019. The plant’s closure was attributed to the economic pressures from cheaper natural gas at the time.

Growing Tech Interest in Nuclear Power

Microsoft isn't the only tech company exploring nuclear energy to meet rising power demands. Amazon has also entered into a deal involving nuclear energy to power its data centers, though the agreement is currently under regulatory review.

The Path Forward

Constellation is seeking to revive Three Mile Island as part of a broader effort to promote nuclear power’s role in providing reliable, clean energy for the future. With Microsoft’s backing, this move may set a precedent for how tech companies address their growing energy needs sustainably.

India dismisses report on ammunition transfer to Ukraine as 'speculative'

Deepshikha Maan, Jadetimes Staff

D. Maan is a Jadetimes news reporter covering Asia

---

Image Source : Dimitar Dilkoff

India Rejects Claims of Ammunition Transfers to Ukraine as 'Speculative

India has firmly denied a report that accuses the government of failing to stop European buyers from diverting Indian made artillery shells to Ukraine. The report, published by Reuters on Thursday, alleges that European customers have been transferring ammunition sold by Indian arms manufacturers to Ukraine, despite repeated protests from Moscow.

Reuters Report on Ammunition Transfers

According to the Reuters article, artillery shells produced in India have allegedly been diverted to Ukraine by European buyers for more than a year. The report claims that Delhi has not taken any steps to halt these transfers, which have occurred despite Moscow’s objections. The accusations suggest that India has been indirectly contributing to the supply of ammunition used in the ongoing conflict in Ukraine.

India’s Response

India’s Ministry of External Affairs has rejected the allegations, calling the report “speculative” and “misleading.” In a statement on X (formerly Twitter), ministry spokesperson Randhir Jaiswal said, "The report implies violations by India, where none exist, and hence, is inaccurate and mischievous." He emphasized that India has an "impeccable track record" of complying with international arms non-proliferation obligations and maintains strict export control regulations.

Jaiswal also noted that India has robust export rules that ensure weapons sold to designated buyers are not transferred without authorization. In May, India further tightened its export regulations, requiring buyers to certify that arms would not be sent to third countries.

Impact on India Russia Relations

Moscow has yet to respond to the report or India’s dismissal of the allegations. However, according to Reuters, Russia raised the issue with Delhi on at least two occasions, including during a meeting between the foreign ministers of both nations in July.

India has historically maintained a close relationship with Russia, and Moscow remains a key trade and defense partner despite international sanctions. Russia was India’s largest oil supplier last year and continues to provide more than 60% of India’s defense needs. India has so far refrained from directly criticizing Russia over its actions in Ukraine, instead advocating for diplomacy and dialogue.

Ammunition Shortages in Ukraine

The Reuters report cites unnamed Indian and European officials, as well as customs data, to suggest that India produces a small fraction of the ammunition used by Ukraine, accounting for less than 1% of Kyiv’s total arms imports since the war began in 2021. European countries, including Italy and the Czech Republic, were identified as having sent Indian-made ammunition to Ukraine.

Ukraine, which has been facing a renewed Russian offensive, is reportedly dealing with shortages of artillery ammunition, making the alleged transfers significant. However, India’s arms export regulations strictly prohibit unauthorized transfers, and any such actions could jeopardize future arms sales.

India’s Diplomatic Balancing Act

India's foreign policy has focused on balancing its relationships with both Russia and Western powers. While Delhi has avoided directly condemning Russia over its invasion of Ukraine, it has stressed the importance of respecting national sovereignty and territorial integrity. Prime Minister Narendra Modi has also consistently advocated for dialogue to end the conflict.

In July, Modi made his first bilateral visit to Russia since his re-election, where he referred to President Vladimir Putin as a “dear friend.” This visit drew criticism from Ukrainian President Volodymyr Zelensky, who expressed disappointment over Modi’s warm relationship with Putin. However, Modi later held talks with Zelensky, underscoring India's non-aligned approach in geopolitics.