India's Economic Outlook: Navigating Tariffs, Growth, and Innovation

Chief Economic Adviser V Anantha Nageswaran expressed optimism about resolving the US-India tariff issue within ten weeks. Despite current challenges, India's economy shows resilience, with robust growth across sectors and a promising external sector. Nageswaran also emphasized innovation and infrastructure development to sustain long-term growth.

On Thursday, Chief Economic Adviser V Anantha Nageswaran stated his optimism for resolving tariff issues with the United States within the next eight to ten weeks. Currently, conversations between the two governments are underway behind closed doors.

The U.S. imposed an additional 25% tariff on Indian products in August, resulting in a total levy of 50% due to India's purchases of Russian oil. Nageswaran highlighted how these tariffs could potentially lead to a drop in U.S. exports if unresolved, though he believes they might be lifted by the end of November.

Discussing India's economic performance, Nageswaran described it as an aspirational lower-middle-income economy, with real GDP growth of 7.8% in the first quarter. Post-COVID, India's economy has outpaced many others, with growth contributions expected from manufacturing, services, and agriculture. Rural demand remains strong, and recent GST rate relief could boost urban consumption.

(With inputs from agencies.)