Strong Domestic Mkt Will Rid India Of Global Shocks: Moody’s

New Delhi: 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, Moody’s Ratings said on Wednesday.

In a note on India, 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. Easing inflation offers the potential for interest rate cuts to further support the economy, even as the banking sector’s liquidity facilitates lending. “India is better positioned than many other emerging markets to deal with US tariffs and global trade disruptions, helped by robust internal growth drivers, a sizable domestic economy and a low dependence on goods trade,” Moody’s said.

Besides, the Pakistan-India tensions, including the flare-up earlier in May, would weigh on Pakistan’s growth more than on India’s. “In a scenario of sustained escalation in localised tensions, we do not expect major disruptions to India’s economic activity because it has minimal economic relations with Pakistan.