New Delhi, Aug 29 In a major embarrassment for US President Donald Trump, who in a rhetorical overdrive termed India as a “dead economy,” the country’s economic growth has accelerated to 7.8 per cent in the April to June quarter, fortifying its position as the world’s fastest-growing major economy.
The strong economic performance amid the US tariff turmoil comes on the back of a 7.4 per cent growth in the previous Jan-March quarter (Q4 FY25).
The strong macroeconomic fundamentals of the economy are reflected in the high foreign exchange reserves, which are sufficient to finance 11 months of imports, and inflation is well under control.
Union Commerce and Industry Minister Piyush Goyal said on Friday that India’s exports this year will be higher than last year, reflecting the growing competitiveness and resilience of the Indian industry, while the government is reaching out to partner countries across the globe to open up new opportunities.
Goyal highlighted India’s expanding network of Free Trade Agreements (FTAs) with developed countries, including Australia, the UAE, Switzerland, Norway, Liechtenstein, Iceland, and the UK, with negotiations ongoing with the European Union and others.
These agreements will further open global opportunities for Indian industries such as construction, steel, and allied sectors, he pointed out.
Goyal further highlighted that several developed countries are eager to expand trade relations with India, noting that nations such as Qatar and the United Arab Emirates (UAE) have expressed keen interest in entering into Free Trade Agreements (FTAs) with India.
The minister’s assurance came in the backdrop of the hike in US tariffs on Indian exports to 50 per cent as a punitive step for buying Russian oil.
According to economists, the macroeconomic impact of the US hike in tariffs would be cushioned by the large size of India’s domestic market.
A recent Morgan Stanley report stated that India is the “best placed country in Asia,” amid the global uncertainty triggered by US President Donald Trump’s threat to jack up tariffs, because of the nation’s low goods exports to GDP ratio.
“While India is exposed to direct tariff risks, we believe on balance India is less exposed to global goods trade slowdown, considering that it has the lowest goods exports to GDP ratio in the region,” the report stated.
According to a Fitch report, the large size of India’s domestic market, which reduces reliance on external demand, is expected to insulate the country from the US tariff hike, with the economy expected to maintain a growth of 6.5 per cent in FY26.
--IANS
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