Trump's Tariffs Impact: RBI Governor Sanjay Malhotra's Warning On India's Growth

The global economic outlook has been clouded by President Trump's new tariffs, and Reserve Bank of India Governor Sanjay Malhotra has issued a stern warning about the implications for India's economy. In his first monetary policy statement of the financial year, Malhotra highlighted how these tariffs exacerbate uncertainties, dampen investments, and weigh down merchandise exports. He also warned of potential pressure on the rupee and imported inflation due to currency depreciation. The RBI has revised India's GDP growth forecast for FY26 to 6.5%, down from 6.7%, aligning with projections from global institutions like the IMF and OECD. Malhotra emphasized that while services exports remain resilient, merchandise exports face significant headwinds from trade disruptions. To mitigate these risks, the RBI has pivoted its stance to "accommodative," cutting the repo rate for the second consecutive month. Despite the challenges, Malhotra pointed out that India could benefit from trade diversions and a bilateral trade agreement with the U.S., expected later this year. As uncertainties loom large, watch this video to understand how Trump's tariffs are reshaping India's economic trajectory and the measures being taken to navigate this turbulent landscape.