S&P Global Ratings revised India’s growth projection to 6.3 percent for the current fiscal year, citing US tariff policy uncertainties. Read on for more details.read moreS&P Global Ratings on Friday revised India’s growth projections downward by 0.2 percent points to 6.3 percent for the current fiscal year, citing uncertainties related to US tariff policies and potential economic spillovers. India, however, remains the
fastest-growing major economy. China, for example, is likely to grow at 3.5% in FY26, according to S&P.In its report titled “Global Macro Update: Seismic Shift in US Trade Policy Will Slow World Growth,” S&P Global Ratings emphasized, “we reiterate that there are no winners in a scenario of escalating protectionist policies.” According to S&P, among the major economies of the Asia-Pacific region, China is anticipated to experience a growth decline of 0.7 percentage points in 2025 to 3.5 percent and in 2026 to 3 percent.STORY CONTINUES BELOW THIS ADS&P projected India’s GDP growth to be 6.3 percent in the 2025-26 fiscal year and 6.5 percent in the 2026-27 fiscal year.In March, S&P had already lowered the FY’26 GDP growth forecast from 6.7 percent to 6.5 percent.More from India
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900+ and soaring: Sensex jumping in joy after big tech posts profits, Trump hints at India-US trade deal“The risks to our baseline remain firmly on the downside, primarily due to a stronger-than-anticipated spillover from the tariff shock to the real economy. The longer-term configuration of the global economy, including the role of the US, is also less certain,” S&P noted.Regarding exchange rate fluctuations, S&P projected the INR/USD exchange rate to be 88 by the end of 2025, up from 86.64 in 2024.The INR/USD pair has seen significant fluctuations since the US tariff announcement, with the rupee currently hovering around the 84-level against the dollar.According to S&P, the US economy is expected to grow 1.5 percent this year and 1.7 percent the next.The global rating agency stated that the US tariff policy would fall into three categories: China will be considered an individual case due to ongoing geopolitical rivalry and long-standing trade tensions. Trade relations with the EU are likely to be complex, while Canada is expected to take a firm stance in trade talks with the US.STORY CONTINUES BELOW THIS AD“We expect most other countries will attempt to negotiate a settlement rather than retaliate,” S&P stated.Thus far, the economic impact of the tariff shock has been limited to declines in confidence indices and drops in nominal variables such as financial asset prices. It has not yet significantly affected the real economy, apart from some front-running of imports to avoid tariffs.However, S&P noted that this may be beginning to change, as goods shipments from China have recently started to decline.TagsChinaIndiaIndian EconomyEnd of Article
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India to grow at 6.3%, China at 3.5%: S&P flags Trump tariff uncertainties for FY26
