India faces a potential drag on GDP growth from the ongoing US tariffs, which could shave 0.6-0.7% off GDP if they persist, according to PD Singh, CEO, India & South Asia, Standard Chartered Bank. However, a mix of fiscal and monetary measures, alongside structural reforms, is expected to cushion much of the impact.  “We are in an uncertain period of time, and we do hope that things will get resolved quickly on the tariff front, which is my personal belief as well,” said Singh.

The StanChart India CEO pointed out to what he described as the government’s “three arrows” approach to offset tariff pressures: GST cuts, director tax reductions and interest rate cuts. Together, these steps are expected to add back a similar number to the GDP. “If you have the Pay Commission coming in, that could add another 100 basis points of GDP impact as well. So, the consumption story comes back, net addition to the GDP, and also counterbalancing by going to different trade corridors,” explained Singh.

On the trade front, the banker said corporates are in a cautious mode. “It’s little bit of wait and watch because we are hoping the untangling is happening as we are speaking right now. There is definitely reduced activity. There is also a wait and watch approach to newer orders coming in,” he told Fortune India.

The additional tariff burden is being absorbed by stakeholders. “Both sides have taken that [hit on the 50% tariff], and again, I think bargaining is sometimes on one side or the other,” the banker noted. At the same time, the disruptions are creating new opportunities. “There are other buyers who are sensing an opportunity. If you cannot complete this consignment, please give it to us. There are domestic players that are willing to buy excess capacity as well,” Singh elaborated.

In these uncertain times the bank sees opportunities to handhold its clients. “Companies need to go to new markets, they need to understand regulations, the banking requirements, they need support. That’s where we step in and help them out. We call them corridor natives,” the executive said, stressing the bank’s role in helping clients diversify geographies and navigate risks.

Small and medium enterprises (SMEs) remain at the core of India’s growth story and an integral focus for the bank. “SMEs are a very important part of nation building for us. There is a very large number of SMEs that we do business with. In fact, a lot of the business owners are our private banking customers as well,” mentioned Singh.

The bank offers a full suite of services tailored for SMEs, ranging from cash management and trade finance to working capital solutions, small business loans, and risk management products, including foreign exchange hedging. “We have the entire continuum of products that SMEs can do,” he said, highlighting the breadth of offerings aimed at supporting business owners through multiple stages of growth.

Interestingly, around 70% of the bank’s private banking clients are themselves entrepreneurs. This overlap allows the bank to serve SME owners holistically, catering to both their business and personal banking needs.