In response to US President Donald Trump’s remarks on India’s economy, Reserve Bank of India (RBI) former Governor Shaktikanta Das defended the nation’s economic prospects. Trump had recently branded the economies of India and Russia as “dead” while warning of fresh tariffs on Indian goods.
However, Sanjay Malhotra struck a confident tone during the RBI’s monetary policy announcement, stating that India holds “bright prospects” in a shifting global order. The Indian rupee fell further as trade concerns increased, even as the central bank maintained the repo rate at 5.5%.
The RBI’s message is very clear that India is still committed to long-term economic stability and strength despite outside pressure and geopolitical challenges.
RBI Highlights India’s Economic Resilience
Sanjay Malhotra emphasized India’s future-ready economic position during the RBI’s monetary policy announcement. “By using its natural strengths, the Indian economy has promising prospects in the evolving global order over the medium term,” he stated. His comments coincided with a 16-paise decline in the value of the Indian rupee as a result of market trepidation over Trump’s recent tariff threats.
Despite global challenges, the RBI remained steady, leaving the key repo rate unchanged at 5.5%. The Monetary Policy Committee (MPC), which met earlier in the day, reaffirmed India’s cautious yet optimistic stance. Inflation trends and muted global growth, Malhotra said, continue to shape the policy outlook.
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Trump Rekindles Tariff Fire on India
Trump’s latest attack on India came in two parts. First, in a post on Truth Social, he slammed India and Russia, saying, “They can take their dead economies down together, for all I care.” He also accused India of imposing some of the world’s highest tariffs, damaging US trade interests.
Then, speaking to CNBC, Trump confirmed his intention to impose fresh duties within 24 hours. Currently, the US already enforces a 25% tariff on certain Indian imports. The new set of measures is expected to take effect by August 7.
India’s Growing Relevance in a Fragmented World
Malhotra’s remarks suggest a more comprehensive strategic shift, in addition to defending growth numbers.
India is at the centre of a multipolar economic order, in international supply chains, the nation is proving to be a dependable substitute for China.
Calm Amidst the Storm
The position of the RBI demonstrates that India is opting for long-term stability rather than impulsive changes to its policies.
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