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    US tariffs cloud India’s manufacturing ambitions: WEF

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    US tariffs cloud India's manufacturing ambitions: WEF

    India’s manufacturing ambitions face headwinds from the US tariff of 50%, a development that also weighs heavily on the regional outlook, according to the Chief Economists Outlook by the World Economic Forum (WEF) released on Tuesday.The US tariff on India is among the highest alongside Brazil, impacting its manufacturing and labour-intensive sectors. This includes a 25% penal tariff for India’s oil imports from Russia.Growth expectations for South Asia have softened, with 31% of chief economists forecasting strong or very strong growth in the year ahead compared to 33% in April. Meanwhile, the share expecting moderating growth rose to 66% from 55%, it said. China’s outlook remains mixed, with 56% of economists anticipating moderate growth, though deflationary pressures are expected to continue. In the US, 52% chief economists expect weak or very weak growth and 59% predict high inflation, even as 85% anticipate monetary policy loosening. “Emerging markets are anticipated to be the main engines of growth, with the Middle East and North Africa (MENA), South Asia and East Asia and Pacific seen as bright spots,” the report said. Roughly one in three chief economists expect strong or very strong growth in these regions.Global economyAround 72% of chief economists surveyed expect the global economy to weaken in 2026 due to trade disruptions, policy uncertainty and technological changes. They also warned of widening divergence between advanced and developing economies, with 56% anticipating greater divergence over the next three years.Live EventsLooking further ahead, most economists expect long-term disruption across key areas, such as natural resources and energy (78%), technology and innovation (75%), trade and global value chains (63%) and global economic institutions (63%).”The contours of a new economic environment are already taking shape, defined by disruption across trade, technology, resources and institutions,” said World Economic Forum managing director Saadia Zahidi. “Leaders must adapt with urgency and collaboration to turn today’s turbulence into tomorrow’s resilience,” she added.Inflation to moderateAcross South Asia, 64% of respondents expect moderate inflation in the year ahead, 74% foresee no change in monetary policy, and 80% expect steady fiscal policy. The RBI’s monetary policy committee is scheduled to meet September 29-October 1.Add as a Reliable and Trusted News Source Add Now!
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