Government Plans Cushion Against US Tariff Shock, Confident of Fiscal Target
- By Thetripurapost Desk, New Delhi
- Aug 31, 2025
- 582
The government is preparing a set of measures to shield industries and workers from the fallout of the United States’ steep 50 per cent tariff hike on Indian exports, Economic Affairs Secretary Anuradha Thakur has said.
“There are certain employment-heavy sectors which do have exposure to the US and to that extent may get affected. The government is well aware of that and is assessing the possible impact and working towards possible solutions,” Thakur told PTI. She indicated that some steps have already been taken, with more in the pipeline to support domestic demand and manufacturing units facing tariff pressure.
According to officials, the commerce ministry is finalising short-, medium- and long-term strategies to cushion exporters. Immediate measures being considered include easing liquidity constraints, granting more flexibility to SEZ units, and promoting targeted import substitution to prevent job losses and insolvencies.
Thakur also pointed to broader reforms underway, including the Union Budget’s decision to exempt income up to ₹12 lakh from tax and the upcoming GST rationalisation expected to lower commodity prices. A strong monsoon, she added, should further boost agriculture and rural consumption.
On fiscal management, Thakur expressed confidence in achieving the Centre’s 2025–26 fiscal deficit target of 4.4 per cent of GDP, or ₹15.69 lakh crore, despite higher deficit numbers recorded in the first four months of the year. “Quarter-by-quarter or month-by-month assessments may not give a correct picture because of temporal mismatches,” she said, stressing that the full-year target remained within reach.
Highlighting India’s resilience, Thakur noted that the economy grew 7.8 per cent in the April–June quarter, its fastest pace in five quarters, outpacing China’s 5.2 per cent. “The Q1 numbers reflect the basic resilience of our economy, anchored in strong macroeconomic fundamentals,” she said, citing robust performances in manufacturing, construction, services, agriculture, and steady domestic demand.
With India retaining its status as the world’s fastest-growing major economy, the government is banking on both reform measures and targeted support to industries to weather the US tariff shock while maintaining momentum on growth and fiscal discipline.