US Tariff Reductions Boost India's Export Prospects

Moody's reports that the reduction of US tariffs on most Indian goods will bolster India’s export growth. Sectors like gems, jewelry, textiles, and apparel will benefit, while pharma and consumer electronics remain unaffected. A sudden halt in India's crude oil imports from Russia might disrupt economic growth and inflation.

The recent reduction of US tariffs on most Indian goods is poised to significantly boost India's export growth, according to a report by Moody's. This change will positively impact labor-intensive sectors such as gems, jewelry, textiles, and apparel.

Interestingly, the pharmaceutical and consumer electronics sectors, which were previously exempt from high tariffs, are unlikely to face any negative consequences from the tariff reduction. This development presents a promising outlook for India's trade relationships.

However, Moody's cautions that an abrupt end to India's crude oil purchases from Russia could destabilize the country's economic growth. A complete transition towards sourcing non-Russian oil could strain global supply, leading to increased prices and inflationary pressures.

(With inputs from agencies.)