Moody Says 50 Percent US Tariffs to Hit Indian Exports Hard

According to an analysis by Moody's Analytics, the combined 50% tariff on Indian exports to the United States will "very substantially" lower demand for Indian goods. The paper discussed the combined impact of U.S. President Donald Trump's 25% tariff on Indian imports, which is currently in place, and his 25% secondary tax on India's economic transactions with Russia, which is scheduled to take effect on August 27.

“India has expereinced a sudden deterioration in its relations with the U.S and has been threatened with 50% tariffs, a rate that will reduce demand for Indian goods very substantially," the report said. A drop in sales to their biggest client “will  hurt", it continued, adding that the U.S tariff have left nations in Europe and the Asia-Pacific area " feeling bruised" because the U.S is their biggest trading partner. " Some firms in these countries may be willing to slash prices to maintain volumes, but this will affect firm performance through lower margins, a squeeze on wages and investment", Moody's Analytics added. “Given that we now expect tariffs to remain in place for the remainder of Trump's presidency, the drag on growth, particularly in investments and exports, will be notable," it said.

Also Read: ACMA Urges Export Market Diversification Amid US Tariff Concerns

To assist business and financial executives in making informed decisions, Moody's offers data, intelligence, and analytical tools. With more than 115 years of experience, Moody's offers highly qualified analysts, comprehensive data, strong tools backed by innovative technologies, and a forward-looking perspective.