There is no cause for panic, say sources, as US tariffs of 50 percent took effect Wednesday on many Indian products, doubling an existing duty as President Donald Trump sought to punish New Delhi for buying Russian oil.
"Do not panic, impact unlikely to be as severe as feared given diversified nature of Indian exports," news agency PTI reported citing sources.
"It is a temporary phase in a long-term relationship," the agency reported.
The development comes hours after US Treasury Secretary Scott Bessent told Fox Business that Trump had good ties with Indian Prime Minister Narendra Modi, hinting that all may not be lost.
"I think at the end of the day, we will come together," Mr Bessent said.
While Trump has slapped fresh duties on allies and competitors alike since returning to the presidency in January, this 50-percent level is among the highest that US trading partners face.
Trump has raised pressure on India over the energy transactions, a key source of revenue for Moscow's war in Ukraine, as part of a campaign to end the conflict.
The United States was India's top export destination in 2024, with shipments worth $87.3 billion. Analysts have cautioned that a 50-percent duty is akin to a trade embargo and is likely to harm smaller firms.
Ajay Sahai, director general of the Federation of Indian Export Organisations, called for "liquidity support from the government."
"We want to ensure that even if business stops, we are able to keep workers on the payroll", he told AFP, saying they were "still optimistic" for trade negotiations.
India has criticised the levies as "unfair, unjustified and unreasonable".
Economists say that India should use this defining moment to accelerate 'Make in India 2.0', strengthen supply chains, and diversify export markets, and the pain could sow the seeds of long-term gain.
India's GDP is expected to grow between 6.8 per cent and 7 per cent in the first quarter this fiscal (Q1 FY26), due to higher discretionary spending, an SBI Research report had said last week. The gross value added (GVA) growth is estimated at 6.5 per cent for the quarter.
Delhi's air quality deteriorated on Diwali, with 34 out of 38 monitoring stations recording pollution levels in the 'red zone' on Monday, indicating 'very poor' to 'severe' air across the national capital.
Delhi recorded an AQI of 335 on Diwali morning after people burst crackers overnight, causing severe noise pollution and blanketing the national capital in smoke.
Anti-pollution curbs under GRAP-2 have been invoked for Delhi and surrounding areas as the Air Quality Index has plunged ahead of Diwali. Curbs under GRAP-1 had been enforced just last week.
Air Quality in the national capital continued to be in the 'Poor' category on Sunday morning. As per the Central Pollution Control Board (CPCB), the Air Quality Index (AQI) around ITO was recorded at 284.
Delhi's air quality continued to deteriorate on Saturday, remaining in the "poor" category for the fifth consecutive day, with nine monitoring stations falling in the red zone of the "very poor" category as pollution levels spiked ahead of Diwali.
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