High US tariffs pose risk to India’s growth: Crisil

**High US Tariffs Pose Risk to India’s Growth: Crisil**

*By Akash Pandey | Sep 27, 2025, 05:01 PM*

A recent report by Crisil Intelligence highlights that the high tariffs imposed by the United States on Indian goods could pose a significant risk to India’s economic growth. The September report cautions that these tariffs may adversely affect both Indian exports and investments.

However, the report also offers a positive outlook, noting that domestic consumption is expected to drive growth going forward. This optimism is supported by low inflation levels and anticipated rate cuts.

**Economic Indicators: GDP Growth and Inflation Projections**

India’s GDP growth reached a five-quarter high of 7.8% in the first quarter of fiscal year 2025-26, rising from 7.4% in the same period last year. Despite this, nominal GDP growth slowed to 8.8% compared to 10.8% in the previous year for the same quarter, according to Crisil Intelligence.

On the inflation front, the report projects that consumer price index (CPI) inflation will ease to 3.5% in the current fiscal year, down from last year’s 4.6%.

**Inflation Control: Factors Influencing Inflation Rates**

The report emphasizes that robust agricultural growth is expected to help keep food inflation in check, though the full impact of recent excess rainfall is still under evaluation.

Additionally, lower crude oil prices and stable global commodity prices are likely to contain non-food inflation. These combined factors will play a crucial role in managing inflation in the coming months.

**Policy Outlook: RBI Likely to Implement One More Rate Cut**

Regarding monetary policy, Crisil Intelligence anticipates that the Reserve Bank of India (RBI) will implement one more rate cut during the current fiscal year, followed by a pause.

The RBI’s Monetary Policy Committee had already cut the repo rate by 100 basis points between February and June 2025. The central bank is now expected to wait for the full transmission of these past cuts before making any further decisions on interest rates.

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In summary, while high US tariffs present notable challenges to India’s economic growth, strong domestic consumption, controlled inflation, and supportive monetary policy are poised to sustain India’s growth momentum in the near term.
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