“We are signaling that India is not a tariff king,” Tuhin Kanta Pandey said in an interview, adding it was an indication to both the domestic industry as well as investors.
India on Saturday cut tariffs on a slew of products in sectors ranging from electronics to textile, as it looks to boost local manufacturing and attract firms looking to diversify away from China. The reductions, effective from Feb. 2, come just as US President Donald Trump imposed tariffs on Canada, Mexico and China over the weekend and drew retaliatory fire from those countries.
“Our message is clear, don’t get into protectionist mode,” Pandey said, adding that India’s tariffs were much lower than even some of the developed economies like Japan. He said the latest measures were done to ensure policy consistency for investors.
The government reduced duties on solar modules and high-end motorcycles, the latter a long pending issue since Trump’s first term in office.
Budget Maths
On budget estimates for the new fiscal starting Apr. 1, Pandey said the government would stick to the fiscal deficit and borrowing targets. The budget raised the exemption limit for personal income tax and tweaked the slab rates, which will lead to one trillion rupees of less revenue next fiscal. “Tax changes will bring in consumption and investment multiplier,” Pandey said. On the issue of Trump warning BRICS countries of 100% tariffs if they tried to replace the dollar with a new currency, Pandey said the government had “no intention to replace the dollar” as the reserve currency.
Content Source: economictimes.indiatimes.com