India assessed the impact of US duties on the economy: 0.6% in 2025 and serious risk beyond

US duties on Indian goods that have reached 50% could reduce India's GDP by 0.5-0.6% in 2025. About said anantha Nageswaran, chief economic adviser to the government, in an interview with Bloomberg TV.

According to him, the impact of duties on India's GDP depends on the duration of their validity: "Depending on how long it [the duty] lasts, even in this fiscal year, it could lead to a GDP impact of 0.5% to 0.6%.".

Nageswaran emphasized that if the duties remain in place for the next fiscal year, the negative effect will be even greater and pose a serious risk to the economy.

President of the United States Donald Trump doubled duties on Indian goods last month – up to 50%. The reason was that India continues to buy Russian oil.

These are the highest tariffs in Asia, making Indian goods uncompetitive in the market compared to products from Vietnam or Bangladesh. Labor-intensive industries, such as textiles and jewelry, will be most affected.

Despite the risks, Nageswaran said that the Indian government maintains its economic growth forecast of 6.3-6.8% until March 2026. In the first quarter of this year, the country's GDP grew by 7.8%, the highest rate in more than a year.

In his opinion, tax cuts and record low inflation over the past eight years should support consumer demand.

In addition, the recent reduction in the tax on goods and services for most everyday goods could add another 0.2-0.3% to GDP.

India expects to achieve this year's budget deficit target of 4.4% thanks to the Central Bank's payments and asset sales, Nageswaran added.

• Earlier, Reuters wrote that India will lose due to Trump's duties twice as much as it saved on oil from Russia.
• At the end of August, the Indian rupee fell to a record low against the dollar due to investor concerns about the impact of the 50% US tariffs on the country's economic growth and corporate earnings.