India Playbook 2025: Proposed tariff imposition from US punishes Indian market despite resilient economy
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Despite Global equity markets cheering to talks between US & Russia & moving up 3% in the last month(Mid Jul-Mid Aug), Indian markets have underperformed the world with large cap being flat & Mid & Small cap falling 3% & 5% respectively. FIIs too who had put in almost $4bn (Apr-Jun) became net sellers in the month of Jul-Mid Aug. The key risk investors have perceived about India has been 2: 1) The proposed tariff imposition of 50% from US due to India’s nexus with Russia. 2) The quarterly results of Q1F26 depicted a topline growth of 6-7% for the broader index, one of the slowest topline growths in the last 12 quarters. This suggests a possible continued slowdown in B2C consumption as depicted by the country’s loan book growth of 10-11% down from a peak of 18-20%. The Indian Government has announced radical changes in the GST after 8 years which should lead to lower prices for mass goods for consumers & propel cons...