Global Trade Tensions Cloud Economic Prospects

Reserve Bank Governor Sanjay Malhotra revealed that trade tariff measures have clouded global economic outlook, risking new headwinds for growth and inflation. India's exports face negative impacts from global tariff wars. RBI revised growth projection down to 6.5% from 6.7% due to these uncertainties.

Reserve Bank Governor Sanjay Malhotra stated on Wednesday that global trade tariff measures have significantly clouded the economic outlook across multiple regions, posing potential risks for growth and inflation worldwide.

Discussing the effects of a global tariff conflict on India, Malhotra indicated that it could adversely affect the country's export capabilities, particularly in merchandise, although services exports might exhibit resilience amidst global uncertainties.

In light of these developments, the Reserve Bank of India has adjusted its economic growth forecast for the current financial year from the initial 6.7% to 6.5%. Meanwhile, with mounting trade tensions and policy unpredictability, the US has introduced reciprocal tariffs on Indian goods, escalating trade complexities.

(With inputs from agencies.)