S&P Global Ratings Downgrades India's Growth Amid US Tariff Uncertainty

S&P Global Ratings has lowered India's growth projection for the current fiscal year to 6.3%, down by 0.2 percentage points, citing US tariff policy uncertainty. The report highlights potential downside risks due to global protectionist trends, with significant implications for China and other major economies.

S&P Global Ratings has revised India's economic growth forecast for the current fiscal year, trimming it by 0.2 percentage points to 6.3%. The adjustment arises amid uncertainties surrounding the US tariff policy and its potential spillover effects on the global economy.

In a report titled 'Global Macro Update: Seismic Shift In US Trade Policy Will Slow World Growth,' the agency emphasised that there are no clear beneficiaries in an escalating protectionist policy scenario. The report predicts China's growth to fall 0.7 percentage points in 2025 to 3.5%, shrinking further to 3% in 2026.

S&P also projects India's GDP growth slightly rising to 6.3% in 2025-26 and 6.5% in the 2026-27 fiscal year. The report points out that the global economic landscape shows significant risks, with the US economy expected to grow modestly by 1.5% this year and 1.7% the next.

(With inputs from agencies.)