India is ready to deal with Trump’s tariff
The US has imposed 50 percent tariff on many goods in India, which has increased the pressure on India’s export sector. But the government has made a special strategy to face it. The Finance Ministry said on August 27 that due to the slow pace of the world’s economy, commodity prices can remain under control. This can reduce the effect of American tariff to some extent. The government believes that the effect of American tariff will be reduced only when trade talks between the two countries will continue. Although the US trade delegation’s visit to India has been canceled this month, the conversation is open.
Limited effect of tariff
In the July Monthly Economic Review of the Finance Ministry, it has been said that America’s tariff may have a short -term effect on India’s exports, but its secondary effect on the economy is more concerned. The ministry has made it clear that for this, talks on trade deal with America are very important. The ministry also said that if the government and private sector work together then the effect of this tariff can be reduced to a great extent. Large companies are financially strong, which can handle this situation. Due to this, small and medium companies can also come out strengthened.
Emphasis on domestic reforms
India has now made free trade agreement with many countries, changing its trade policy. Recently such an agreement has been reached with Britain. European Union, New Zealand, Chile and Peru are also in talks on free trade agreement. However, the full impact of these agreements still asks for time. The situation is positive at the domestic level. The monsoon was better than the average, retail inflation is under control and crude oil prices are stable. The government is engaged in increasing production, strengthening supply chains and finding alternative sources of import. Also, there is a big improvement in GST, which will make business easier.
The growth of the economy will remain intact
The Finance Ministry hopes that India’s economic growth will remain good even further. Economic activities have been strong in July. The government has also maintained a task force for further reforms, which will plan for the next round reforms. S&P has also increased India’s credit rating to BBB, which is a positive sign for the market. Rules of business are also being simplified in states. The government believes that the negative effects of American tariffs can be reduced through the right strategy and dialogue. India’s economy will remain strong and dynamic.