US tariffs: India readies steps to protect exporters; domestic demand push in focus, says economic affairs secretary

India mulls measures to protect exporters after US tariffs (AI picture)

The authorities is getting ready measures to cushion industries and staff from the fallout of the United States’ steep tariff improve on exports, in accordance to Economic Affairs Secretary Anuradha Thakur. “There are certain employment-heavy sectors which do have exposure to the US and to that extent may get affected. The government is well aware of that and is assessing the possible impact and working towards possible solutions,” mentioned Thakur in an interview with PTI. Thakur indicated that steps have already been taken, with extra measures in the pipeline to help domestic demand and assist manufacturing models hit by the tariff shock. She additionally pointed to broader reforms in play, together with the Union Budget’s determination to exempt earnings up to Rs 12 lakh from tax and upcoming GST rationalisation geared toward reducing commodity costs. Strong monsoon situations, she added, are anticipated to enhance agricultural output and rural consumption. On fiscal administration, Thakur expressed confidence in attaining the Centre’s 2025-26 fiscal deficit goal of 4.4 per cent of GDP, equal to Rs 15.69 lakh crore, regardless of current slippages. By end-July, the deficit had touched 29.9 per cent of the full-year estimate, in contrast to 17.2 per cent in the identical interval final 12 months. “So this question (of achieving the target) has been coming up because of the latest numbers. I would like to say that quarter-by-quarter or month-by-month assessments of fiscal deficit numbers may not give a correct picture because of temporal mismatches, which may come in on the receipt and expenditure side. On the overall fiscal deficit numbers, our assessment so far is that we will be able to achieve the target,” she mentioned. Thakur underlined India’s “strong macroeconomic fundamentals,” pointing to regular personal consumption and strong private and non-private capex. “Government capex has been a big factor in holding up our numbers so far and not only on the fiscal deficit side but the growth numbers also remain robust as of now,” she famous. She mentioned the economic system’s 7.8 per cent development in the April-June quarter — its quickest tempo in 5 quarters — mirrored broad-based enlargement. “Q1 numbers reflect the basic resilience of our economy. It reflects strengthening of the momentum in the economy and it is anchored in strong macroeconomic fundamentals,” she mentioned. Looking forward, she added, “We feel that the basic features or factors which have held us in good stead in Q1 are good performance of manufacturing, construction and service sectors and strong growth on the agriculture side, as well as domestic demand factors that have bolstered growth numbers.”The secretary’s assertion comes a day after reviews revealed that the commerce ministry is drawing up a complete short-, medium- and long-term plan to protect Indian exporters from the impression of the steep 50 per cent US tariffs on Indian items. Immediate measures into account embody easing liquidity pressures, giving particular economic zone (SEZ) models extra flexibility, and selling focused import substitution to stop insolvencies and job losses, PTI reported citing an official.Also learn: Ministry drafts multi-tier plan to protect Indian exporters; test key measures outlined India’s 7.8 per cent development fee outpaced China’s 5.2 per cent in the identical quarter, reinforcing its place because the world’s fastest-growing main economic system.