The Hindu editorial on 30/08/2025 welcomes India's response to the US tariff issue as a practical approach. Despite repeated provocations from the senior US officials, such as the trade advisor terming the Ukraine war ‘ Modi war’, India calmly retained its position and has been preparing to protect its economy against the penalty tariff, while not closing the doors for trade deal negotiations. Instead of announcing flashy fiscal incentives, the centre is trying to address the liquidity crunch on Exports through practical measures such as engaging with China and propelling domestic consumption through GST cuts that would secure the overall economy. Exports make up 20% of India’s GDP. Out of the total exports, 20% is to the USA, 40% of which is not affected by the penalty tariff. Though the sectoral impacts could be severe, the macroeconomic impact is likely to be less. Easing of Chinese FDI norms is also in the consideration of the Government, but the editorial cautions that it should not affect the national security. And there – state cooperation to insulate the states’ fiscal health from the GST cuts. It concludes reinforcing that it is the time for level-headed action, not emotional outbursts.
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