The Indian govt. has expressed its disagreement with the IMF Forecast that the impact of 50% US Tariffs will stay indefinitely with heavy impact on growth. Further, the IMF staff pegged the country’s GDP growth at 6.6 per cent this year and pared its 2026-27 projection by 2o basis points to 6.2 per cent. It linked the downfall of India’s growth to the high US Tariffs – which is assumed to persist under the baseline, dent external demand and investment.” While Indian authorities agreed that the overall economic growth of India will remain affected with the tariff shock “they also said that it is, however, manageable in the near term, although a few industries would be heavily affected”.
Indian Authorities Express Disagreement with the IMF Forecast
Indian authorities, however, have completely expressed their disagreement with the IMF forecast that the IMF staff painted. Notably, despite of global trade tensions and uncertainties India has expanded its trade into new destinations. The IMF staff called for “targeted, transparent, and time-bound support” to industries heavily affected by tariffs, noting it is warranted to mitigate the distributional impact of the tariffs. The authorities also felt that staff’s potential growth estimate was on the conservative side.
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