India expects consumption tax cuts announced by Prime Minister Narendra Modi will give a boost to the economy without hurting the government’s fiscal deficit, helping to offset the fallout from higher US tariffs.

India would not accept any compromise when it comes to the interests of its farmers, cattle-rearers and fishermen, Prime Minister Narendra Modi said Friday as the country wrestles with steep tariffs imposed by the US following breakdown of trade talks.

U.S. President Donald Trump has announced additional 25% tariff on India for its purchases of Russian oil, bringing the combined tariffs imposed by the United States on its ally to 50%.

Farmers are a key political constituency in India and they violently protested against Modi's last big push to reform the sector, forcing him to repeal three farm laws in 2021 in what was a rare defeat for him.