Daijiworld Media Network- New Delhi

New Delhi, Sep 8: Finance minister Nirmala Sitharaman has said the government is keeping a “good watch” on exchange rates, stressing that the rupee’s weakness is largely against the US dollar, which has strengthened globally.

“The rupee slide is largely against the dollar, not against any other currencies. That’s also because of the way globally, the dollar has strengthened,” she told PTI in an interview.

The rupee closed at a record low of 88.27 per dollar on Friday after touching an intra-day low of 88.38, amid concerns over US tariffs. Intervention by the Reserve Bank of India through state-run banks helped limit further losses.

The US has imposed steep tariffs of up to 50 per cent on Indian goods, effective August 27. These include a 25 per cent penalty on crude oil imports from Russia. Earlier, on August 7, the Donald Trump administration had enforced a 25 per cent tariff on Indian goods, citing trade barriers and India’s continued oil imports from Russia.

Sectors hit by the higher duties include textiles, gems and jewellery, shrimp, leather, animal products, chemicals, and machinery. Pharma, energy products, and electronics remain outside the ambit. The US accounted for about 20 per cent of India’s 437.42 billion worth of exports in 2024-25. Bilateral trade in goods stood at 131.8 billion, with 86.5 billion exports and 45.3 billion imports.

On domestic reforms, Sitharaman described the landmark Goods and Services Tax (GST) overhaul as a ‘people’s reform’ that will reduce prices and boost consumption.

Nearly 400 products – from soaps to cars, shampoos to tractors and air conditioners – will cost less when the rejigged GST takes effect on September 22, the first day of Navaratri. Premiums on individual health and life insurance will also become tax-free.

The new slab structure removes the existing 12 per cent and 28 per cent rates. Goods will now be taxed at 5 per cent for common-use items and 18 per cent for others, with a 40 per cent slab reserved for sin and luxury goods. Daily essentials like bread, milk, and paneer will attract no GST.

“This reform touches the lives of all 140 crore people. There is no individual in this country who is untouched by GST. The poorest of the poor also have something small that they buy, touched by GST,” Sitharaman said.

She added that she would personally monitor whether GST rate cuts are being passed on to consumers through price reductions. Several companies, including car makers, insurance firms, and apparel brands, have already announced price cuts, with more expected by September 22.