Indian economy gained momentum despite US tariffs: Govt report
&imwidth=800&imheight=600&format=webp&quality=medium "Indian economy gained momentum despite US tariffs: Govt report")
A container ship is seen off the coast of Chennai, Tamil Nadu. Photograph: (File)
Indian economy news: The report added that the acceleration despite external headwinds highlights that the domestic economy is resilient.
The Indian economy gained momentum in the second quarter of this financial year despite the United States' tariffs against New Delhi, said the finance ministry'sDepartment of Economic Affairs (DEA). A report by the department said that India's economy strengthened in the second quarter of the financial year 2026 despite aglobal backdrop characterised by economic and trade policy uncertainty.
The report added that the accelerationdespite external headwinds highlights that the domestic economy is resilient. It also shows that the ongoing structural reforms are effective.
The report said thatvarious supply-side high-frequency indicators (HFIs) displayed healthy trends, while demand conditions improved on the back of GST reforms and positive festive season sentiments, which spurred consumption.
What the report said about the Indian economy
It added that on the back of factorslikerobust domestic demand, favourable monsoon conditions, lower inflation, monetary easing, and the continued benefits of GST reforms, the growth outlook for the remaining quarters remains strong.
It also highlighted the growth forecasts by theInternational Monetary Fund (IMF) and the Reserve Bank of India (RBI) -- 6.5 per cent and 6.8 per cent, respectively.
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The report said India's trade performance was robust becausestrong services exports offset the merchandise trade deficit.
The report highlighted that an increase in gross FDI inflows was witnessed, which shows that India is an attractive investment destination.
The report noted that the lower GST rate is expected to support a positive demand outlook by reducing the tax burden on consumers and businesses.
The department warned thatglobal uncertainties could still affect external demand and pose downside risks to growth.
To counter these challenges, the implementation of growth-enhancing structural reforms and government initiatives, including GST 2.0, is expected to mitigate the negative effects of global headwinds, it added.