India’s Growth Forecast Shaken: Moody’s Warns of US Tariff Impact
Moody’s Investors Service has projected a slowdown in India’s GDP growth, forecasting a dip to 6% if the US implements a 50% tariff on Indian goods. This projection is contingent on the tariff’s commencement on August 27th, stemming from concerns over India’s continued purchase of Russian oil.
The anticipated economic contraction of 0.3 percentage points reflects a significant potential blow to India’s economic trajectory. However, Moody’s acknowledges the resilience of domestic demand, which could mitigate the full impact of the tariffs.
Negotiations between India and the US are currently underway to potentially avert this trade dispute. The outcome of these talks will be crucial in determining the actual impact on India’s economic growth.
This potential trade war highlights the delicate balancing act India faces in navigating global geopolitical tensions. The final impact on consumers, businesses, and the overall economy will depend heavily on the success of ongoing diplomatic efforts and the strength of domestic consumption.
