New Delhi:
An important report has come out about the economic pace of the country. Financial service firm Moody’s Analytics has reduced India’s GDP growth for 2025. Earlier this estimate was 6.4%, but now it has been reduced to 6.1%. The major reason for this is being believed to be a reciprocal tariff that can be installed by America.
America’s decision affects India’s trade growth
Moody’s Analytics report ‘APAC Outlook: U.S. In Varse Dem ‘, it is said that America is a big trade partner in India. If the US imposes an extra tax of 26% on Indian goods, then it will affect both India’s export and trade balance.
Which sectors will have the most impact?
Moody’s says that this tariff may have the most impact on gems & jewelery, medical devices and textile industry. The trade of these sectors with America is very high, so they will get a direct impact on them.
Domestic economy will get support
However, the report also said that India’s overall economic growth will not be weak so soon, because the external demand in India’s GDP is still very low. This means that India’s domestic demand still remains strong.
RBI can cut interest rates
The report also said that there is a steady decline in inflation. In such a situation, it is expected that the Reserve Bank of India (RBI) can cut the repo rate by 0.25% by the end of this year. If this happens, the policy rate can come up to 5.75%. This will make it cheaper to take a loan and the market will get support.
Tax exemption and policy will benefit
Moody’s has said that the tax relief and other schemes that the government has launched this year will boost the domestic economy. With this, the shock of tariffs can be balanced to some extent and India’s growth story can remain strong.
America postponed the decision to implement tariff
It is a matter of relief that US President Donald Trump has postponed the new tariff to apply to 75 countries for 90 days. It also includes India. That is, India will not have to pay 26% extra fee right now. However, the US has taken a tough stand against China and up to 125% tariff fee has been implemented on products coming from there.