Reserve Bank of India (RBI) Governor Sanjay Malhotra has expressed deep concerns over the impact of US tariffs on India’s economic growth, deeming it a bigger challenge than inflation. Speaking at the post-Monetary Policy Committee (MPC) meeting on April 9, 2025, Malhotra revealed that the RBI has revised India’s GDP growth forecast for FY26 from 6.7% to 6.5%, citing tariff-related uncertainties as a key factor.
Malhotra emphasized that while inflation remains within the target range of 2-6%, the broader economic risks posed by global trade tensions and tariff hikes are significant. He noted that these measures have disrupted global markets, affecting exports and overall economic activity. “More than inflation, we are concerned about the tariff impact on growth,” Malhotra stated during the press conference.
The RBI has also cut the benchmark repo rate by 25 basis points to 6%, signaling an accommodative stance to stimulate the economy amidst these challenges. Malhotra assured that the RBI and the government are working together to manage growth and inflation effectively, aiming to maintain stability in the economy.
As India navigates the complexities of global trade dynamics, Malhotra’s remarks underscore the need for strategic measures to mitigate the adverse effects of US tariffs and safeguard India’s economic growth trajectory.
