In today’s briefing:
- India Twin Deficit Watch: Fiscal Stimulus to Offset the Trump Tariff Setback to Growth
India Twin Deficit Watch: Fiscal Stimulus to Offset the Trump Tariff Setback to Growth
- India has undertaken a major reform of the GST regime, collapsing the 5 slabs to 3, and substantially cutting the GST-rate for almost all goods and services. Positive for PCE.
- Since 27th Aug’25, India faces a 50% tariff on more than half of its goods exports to the US (its biggest export market), a significant setback to growth.
- FY26 fiscal deficit will likely exceed government targets, but this stimulus will ensure 8%+ real GDP growth despite weaker goods exports. Services strength will keep CAD to 0.6% of GDP.
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