50% Tariff Triggers Crash in Indian Stock Market

Just a day after President Donald Trump doubled tariffs on Indian goods to 50%, India’s stock market took a sharp hit on Thursday morning. The Sensex plummeted by 335.71 points, settling at 80,208.28, while the Nifty index fell by 114.15 points to 24,460.05.

Market analysts warn that if the current tariff situation continues, India’s GDP growth could be adversely affected by 30 to 40 basis points. Dhiraj Relli, CEO of HDFC Securities, noted that in the long run, such high tariffs could significantly slow down India’s economic momentum. However, the Reserve Bank of India has so far maintained its GDP growth forecast at 6.5%.

Nilesh Shah, CEO of Kotak Mahindra Asset Management Company, stated that the doubling of tariffs along with deteriorating U.S.-India relations could destabilize the investment climate.

Despite the tariff pressure, the one-month Dollar-Rupee Non-Deliverable Forward (NDF) market indicates that the Indian currency is likely to remain stable in the near term.

Interestingly, while Trump has threatened to impose a 100% tariff on chip exporters, exemptions granted to U.S. tech giants like Apple have buoyed investor confidence across Asian markets, leading to positive trading in other regions.