'The government is trying to reduce the impact of US tariffs', Economic Affairs Secretary's statement

Economic Affairs Secretary Anuradha Thakur stated that the government is developing an action plan to mitigate the impact of the 50 percent tariff imposed by the US. She mentioned that the government is focusing on boosting domestic demand to counteract the substantial tariff increase, which could aid Indian manufacturing companies facing tariff pressures. Thakur highlighted that some sectors, which employ a large number of people, are affected by the US tariffs. 

The government is aware of this and is evaluating the tariff's impact and taking measures accordingly. She also noted that the government announced zero income tax on income up to Rs 12 lakh under the new tax system in the budget, which will significantly benefit taxpayers. Additionally, the government proposed GST reforms that are expected to lower prices for many commodities. Furthermore, a better-than-expected monsoon is likely to boost agricultural production, possibly increasing demand in rural areas.

Thakur expressed confidence that the government is on track to meet the fiscal deficit target of 4.4 percent set in the budget, estimating the deficit will be 4.4 percent of GDP for 2025-26. She emphasized that the economy’s fundamentals remain strong, supported by positive private consumption data released on Friday. India's economy grew at a rapid rate of 7.8 percent in April-June, the fastest in five quarters. Thakur explained, 'We believe that the fundamental features or factors that have kept us in a good position in the first quarter are the good performance of the manufacturing, construction, and service sectors, as well as strong growth in agriculture and domestic demand, which have strengthened the growth rate.'