Former Governor and economist of the Reserve Bank of India, Dr. Raghuram Rajan has described the heavy tariff on Indian exports of America as extremely worrying. He has described it as a wakeup call for India to reduce dependence on one business partner country.

Speaking about the 50 percent tariffs that came into force from Wednesday, which includes 25 percent additional fine associated with the purchase of Russian oil by India, Dr. Rajan warned that business, investment and finance are being made fast weapons in today’s global system, so India should take care.

Tariff warned for India
In an interview given on Wednesday (August 27, 2025) on India Today, Rajan said that this is a warning that we should not depend too much on any one country. We should now look at East, Europe and Africa and move forward with America, but should implement reforms that help us achieve the growth rate of 8-8.5 percent required to provide employment to our youth.

The Trump administration has imposed this rigorous tariff on India to buy Russian crude oil, while the largest importer of Russian oil is China and Europe, which is buying a large amount of energy products from Moscow. No such concrete action has been taken against them.

‘Need to reconsider Russian oil imports’
Rajan suggested that India revaluate its policy on Russian oil imports. He said that we have to ask who is benefiting and who is harming. Refiners are earning excessive profits, but exporters are paying its price through tariffs. If the benefit is not very high then it is probably worth considering whether we should continue this shopping.

What said on the allegations of the Trade Advisor of the White House
On the allegations of the White House’s Trade Advisor Peter Navaro of making profiteering through Russian oil, Rajan said that it seems that at some point the President (Trump) had decided that India is a country that is not running according to his rules and should be isolated. Navaro will not write in the financial time without permission.

Trump’s long -time associate, Navaro said last week that Indian refiners are earning money by promoting Russian oil and promoting Ukraine war. He argued that he does not need oil. This is a refining profiteering scheme.

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Developed India by 2047: The country is expected to become the fourth GDP in the world by the end of this year, which is growing rapidly towards developed India. However, on behalf of NITI Aayog, it has been said that India has now become the fourth GDP in the world, but the IMF believes that by the end of this year, the country with 4 trillion GDP will become India.

How will India develop?

Meanwhile, it is also estimated that by 2027, India will surpass the world’s third economy, and India will become developed by 2047. But well-known economist and former RBI Governor Raghuram Rajan believes about this. He says that if India is to become developed, then the growth rate will have to move at the rate of 8.5 or 9 percent, because we are still comparatively a poor country.

Raghuram Rajan’s statement came at a time during a private television news channel program when India’s GDP is standing firmly despite global uncertainty. GDP growth in the fourth quarter of FY 2024-45 stood at 7.4 percent and it is estimated to remain at 6.5 percent this year. It is better than many other strong economy of the world.

The growth rate will have to be faster

However, Raghuram Rajan admitted that India’s current growth rate 6.5 percent is a very good Goth rate, especially when the government has cut its expenses during the election. But he said that there is no need to sit in peace now. He said that now it can be the time of India, but we have to take that opportunity. Raghuram Rajan said that India will have to take decisive decisions for sustainable development with investment to increasing consumption, improvement at both domestic and foreign levels.

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Former Reserve Bank Governor Raghuram Rajan believes that at this time, India has a big opportunity to benefit from the current situation, which should not be left. In an interview to India Today, he said that if India takes the right way to the business uncertainty arising from the ongoing tension between the two global cousins, then there can be a tremendous benefit.

Rajan insisted on the fact that at this time we should talk on trade talks, especially America, except for the old stand, so that investment can be promoted and help to Indian exporters. The former RBI governor’s comment has come at a time when there is a tremendous economic pressure on the whole world due to the tariff declaration of US President Donald Trump.

India takes advantage of opportunity

Raghuram Rajan warned that with this step, the American can also bring its economy to Bapti. He said that the unemployment rate had come to a lower level, inflation was low, in such a situation the rate cut was being considered by the Federal Bank. But a sudden shock has created a new challenge.
He said that a country like Vietnam will have a big impact, because he used to export a lot in America. But, its impact on India is going to be very limited, because India’s economy is very big.

Rajan further said that India’s exports to United States have been very low compared to GDP. Yes, it is going to have some effect which will be harmful. But this will not change our economy but will increase our economic speed.

Less impact than GDP

The former RBI governor stressed this and said that India should not ruin this opportunity. He said that this is also a big opportunity for India to reduce its tariff not only on America but other countries. Some economists here had expressed concern over the growing tariff rates of India during the last few years, this is the occasion when it should be reduced. He said that India has this opportunity to improve the policy of trade and investment except for conservationist policy.

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Former RBI Governor Raghuram Rajan said on Thursday that the Donald Trump administration’s stake on about 60 countries will be ‘reverse’. He said that its effect on India will be ‘less’. US President Trump has announced to impose additional value-based duty from 10 percent to 50 percent on imports from all business partners.

He told the news agency PTI, “We should accept that in the short term, it will be the first and foremost to adversely affect the American economy. This is ‘self -goal’ (to harm itself). Talking about the effects on other countries, the direct impact of any fee on India’s exports will be that prices will increase for American consumers, this will reduce their demand and consequently affect India’s economic growth.

The basic fee of ten percent will be effective from April 5 and 27 percent from April 9. Some areas have been exempted from fees. These include medicines, semiconductors and energy products. A well-known economist said, “In fact, since the US has also imposed a fee on other countries and India is competing with the producers of those countries, it will only be less than leaving the fees on India because American consumer will not be able to go to the producers as an option.”

Currently at Business School, Shikgo booth, Professor, Rajan said that the long -term purpose of Trump is to increase American production, but, if it is possible, it will take a long time to achieve it. In response to a question, he said that America’s counter -duty on India will probably not be going to increase inflation, because India will export less and the supply will be higher at the domestic level.

Other countries like China will now try to export India, as the American market is more closed. Asked if India can turn this crisis into an opportunity, Rajan said, “We can definitely reduce the fees we are increasing.” This will be beneficial for India, whether it helps us to reduce American duty. ”

He said that India needs to understand that the world has become very conservationist, so we have to work more cleverly about business. Giving examples, Rajan said that ASEAN and Japan in the east, Africa in the southwest and Europe in the northwest means. He said that establishing equal relations with China should be a priority. Also, we should also have a strong relationship with our neighboring countries, SAARS (South Asian Regional Cooperation Organization). ”

Rajan said, “This means to control political differences. As the world is getting divided into the regional block, South Asia should not be isolated. ”President Donald Trump has announced a historic step to counter about 60 countries, taking a historic step to combat high duty rates on US products globally.

He has announced to impose a counter -duty of 27 percent on India. The Trump administration believes that India charges high import duty on American goods, so it was now necessary to take this step to reduce the country’s trade deficit and promote manufacturing.

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