Calibrate duty cut on agri-products

This is an overdue agenda for India, irrespective of Trump's tariff pressures which will surely have an adverse impact on goods exports

- ASHOK GULATI

US PRESIDENT DONALD Trump has delivered a strong blow to India by imposing 25% tariff along with some unspecified penalty on exports of most Indian goods.

This may hit the overall GDP growth by 20-30 basis points, according to many experts. That means the overall GDP growth in FY26 may not reach 6.5% as expected by the Reserve Bank of India, but may end up somewhere around 6.2-6.3%.

This is a significant loss, but not too big for India to endure.

More damaging is Trump's social media post saying "I don't care what India does with Russia. They can take their dead economies down together, for all I care". Is India a dead economy really? India's economy is growing at more than 6% against the US growth rate of less than 2%.

India is still the fastest-growing large economy in the G20 group. Yes, the size of Indian economy (about $4.19 trillion) is way below that of the US which is touching $30 trillion. But in purchasing power parity terms, we are at more than $16 trillion and already the third-largest economy.

A few things are clear from what has happened on the tariff front. First, the Trump-Modi bonhomie (Howdy Modi) seems to be over. Investing in personal ties does not mean much to Trump. He is transactional and focused on extracting as much from other countries as possible for his Make America Great Again (MAGA) dream.

Second, he is very upset with Russian President Vladimir Putin as he is not heeding Trump's sermons to end the war with Ukraine, which Trump had promised to accomplish within 24 hours of assuming office. Now, he wants to punish those who are trading with Russia, especially for energy and defence needs.