US President Donald Trump‘s 50 per cent tariffs on Indian imports – far steeper than those imposed on other Asia-Pacific countries – would severely curtail India’s ambitions to develop its manufacturing sector, Moody’s Ratings said on Friday.
US President Trump on Wednesday, Aug 6, imposed an additional 25 per cent tariff on Indian goods, taking the total to 50%, citing New Delhi’s continued imports of Russian oil.
Moody’s warns of growth and inflation risks from US trade measures
The doubled tariffs may even reverse some of the gains India made in attracting global investments, the ratings agency said, flagging risks to the country’s growth and inflation.
Moreover, the Reserve Bank of India (RBI) kept its key rates unchanged as expected and retained its “neutral” policy stance following a surprise 50-basis-point rate cut in June.
Cutting Russian oil imports may strain India’s crude supply, warns Moody’s
According to Moody’s, curbing Russian oil imports to avoid penalty tariffs could make it more difficult for India to secure alternative crude supplies in adequate quantities promptly.
Foreign investors extend sell-off amid tariff-driven uncertainty
Global trade uncertainties, fuelled by the US tariffs, have also kept foreign investors on edge.
Foreign portfolio investors have already offloaded Indian shares worth $900 million so far in August, following $2 billion in outflows in July.
Nifty, Sensex extend losses as trade tensions mount
India’s equity benchmarks, the Nifty 50 and Sensex, slipped 2.9 per cent in July and are down 0.7 per cent so far in August, amid heightened investor anxiety driven by the escalating trade uncertainties
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