'Tariff will affect exports', RBI Governor expressed this estimate on the economic challenges after the retaliatory tariff

Reserve Bank of India Governor Sanjay Malhotra has stated after Wednesday's Monetary Policy Committee meeting that the economic situation of different sectors is getting blurred due to the ongoing tariff war across the world. According to Malhotra, this has raised the threat of new growth rates and inflation-linked challenges looming in the world. On America's retaliatory tariff's effect on India, the RBI Governor indicated that it would impact India's exports negatively.

After the first MPC meeting for the current financial year, the Reserve Bank Governor said, "Due to global uncertainties, there may be pressure on the export of goods. At the same time, the export of services is expected to remain flexible. Challenges arising due to disruptions related to global trade will continue to increase the risk of a decline in the global market." In view of the global uncertainties, the RBI has also reduced the growth forecast for the current financial year from 6.7 percent to 6.5 percent.

He said, "Uncertainties remain at a high level due to increased instability in the global economy in recent times. The growth rate forecast for the current financial year has been reduced by 20 basis points compared to the February estimate of 6.7 percent." He said, "Recent trade tariff developments have further increased uncertainties on the economic scenario across various sectors. This has created new challenges for global growth and inflation. Amidst this turmoil, the US dollar has also declined significantly. This has also led to a reduction in bond yields. Equity markets are improving, and crude oil prices have fallen to a three-year low."