With global uncertainty clouding the outlook, investors are increasingly looking beyond the US, and India needs to stay prepared. According to Taimur Baig, MD and Chief Economist at DBS Group, local reforms like GST changes and income tax tweaks are timely and important, regardless of what happens globally.
“I will compartmentalise the two issues,” Baig said. “The three-pronged measures that we have seen – income tax cut, the Reserve Bank of India (RBI) cuts and now the GST rationalisation – are great measures independent of what’s happening on the external side.” He added that India should continue to focus on domestic demand and investment while building trade links with other regions such as Europe and Singapore.
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On the US tariff policy, Baig said uncertainty makes it difficult to form a clear outlook. “Impossible to answer. Absolutely impossible to answer because we don’t know the duration and the magnitude of tariffs,” he said. Posturing and policy under the Trump administration, he noted, are “interrelated” and highly unpredictable.
Baig argued that the biggest casualty of the US approach has been reliability in global markets. He said this uncertainty “is going to hurt investments related to the US” but could encourage more trade and investment outside the US, where 89% of global trade takes place.
On gold, Baig pointed out that prices reflect geopolitical risks more than traditional interest rate cycles. “That difference tells you how much geopolitical uncertainty is being embedded,” he said, noting that demand for gold remains strong as a hedge against volatility.
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He also expects the US Federal Reserve to maintain an easing stance, driven more by labour market concerns than by inflation. Meanwhile, currency movements remain mixed: the US dollar has weakened against major currencies overall, but pressures vary across emerging markets.
Turning to India, Baig said the country’s market valuations could drive outward investment opportunities. Indian companies, he said, “can find it very worthwhile to deploy that valuation to pick up companies in Korea, in Japan.” This, he suggested, could support technology transfer and strengthen India’s growth outlook over the medium term.
For the full interview, watch the accompanying video
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