New Delhi, June 9: India is increasingly positioning itself to absorb global economic shocks by strengthening trade linkages and improving external resilience, according to HSBC Chief India Economist Pranjul Bhandari.
Bhandari noted that amid rising global trade uncertainty and tariff disruptions, India is actively “cushioning itself” through a mix of trade agreements, policy adjustments, and greater external engagement.
She highlighted that recent global tariff shocks have created relative disadvantages for Indian exports, particularly where competing economies face lower trade barriers. In this context, India’s strategy of expanding trade partnerships and enhancing flexibility in its external sector is helping offset external pressures.
According to her assessment, allowing greater currency flexibility also acts as a natural buffer. A gradual depreciation of the rupee can help restore export competitiveness when tariffs erode price advantages, effectively balancing external shocks.
Bhandari further emphasized that India’s services exports, a key strength of the economy, tend to respond strongly to currency movements, adding another layer of resilience.
Overall, she suggested that India’s combination of trade deal-making, structural openness, and macroeconomic flexibility is helping the economy navigate a period of heightened global volatility and protectionist pressures.