In a Bloomberg TV interview on Monday, India’s Chief Economic Adviser V. Anantha Nageswaran stated that U.S. President Donald Trump’s 50% tariffs on India could reduce the country’s gross domestic product (GDP) by half a percent this year.
“Depending upon how long it lasts even in this financial year, it may translate into a GDP impact of somewhere between 0.5% to 0.6%,” he told the broadcaster.
Trump, who is seeking to broker an end to the Ukraine conflict, has said that India’s oil imports are helping to fund Moscow’s war effort. Last month, he doubled tariffs on imports from India to 50%.
Finance Minister Nirmala Sitharaman said last week that India, the world’s third-largest oil importer and consumer, will continue to buy Russian oil as it is economical.
According to U.S. Census Bureau data, U.S.-India two-way goods trade totaled $129 billion in 2024, with a U.S. trade deficit of $45.8 billion.
Exporter groups estimate that the tariffs could affect nearly 55% of India’s $87 billion in merchandise exports to the U.S., while benefiting competitors such as Vietnam, Bangladesh, and China.
Nageswaran said he would stick to the government’s 6.3-6.8% growth forecast for the current fiscal year ending in March 2026, citing the April-June quarter’s 7.8% expansion, which was the fastest in over a year.
