India well-positioned to handle US tariffs impact: Moody's

India is well-positioned to deal with the negative effects of US tariffs and global trade disruptions as domestic growth drivers and low dependence on exports anchor the economy, said Moody’s Ratings in a note on the country. The agency said government initiatives to boost private consumption, expand manufacturing capacity and increase infrastructure spending will help offset the weakening outlook for global demand. The Central Government’s infrastructure spending supports GDP growth, while personal income tax cuts bolster consumption. Besides, the Pakistan-India tensions, including the flare-up earlier in May, would weigh on Pakistan’s growth more than on India’s. India’s limited reliance on the trade of goods and its robust service sector will mitigate US tariffs. Nonetheless, sectors such as auto, which have some exports to the US, face global trade challenges despite their diversified operations, said a report.

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