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GST cuts and tax relief may blunt Trump tariff hit, boost consumption: Pankaj MurarkaOn defence stocks, Pankaj Murarka, CEO and CIO of Renaissance Investment Managers advised caution given high valuations, while in healthcare, he said, it remains a structural growth story driven by rising domestic demand and medical tourism.By Prashant Nair    | Reema Tendulkar    | Nigel D'Souza   August 25, 2025, 1:09:11 PM IST (Published)2 Min ReadThe government’s goods and services tax (GST) rate cut, which adds about 30 basis points (bps) of fiscal stimulus, may offset more than half of the potential impact from US President Donald Trump’s proposed tariffs on India, estimated at around 60 bps, according to Pankaj Murarka, CEO and CIO of Renaissance Investment Managers, which manages nearly $188 million in assets.

Murarka said the cumulative policy actions are providing meaningful support to the economy. “Starting from the budget, the government did tax cuts of about one lakh crore, which is about 30 bps of fiscal stimulus. And now on top of this, we have the GST cuts, which will add another 30-odd bps,” he said.

Along with the Reserve Bank of India’s (RBI) 100 bps rate cut, he estimates nearly 1% of gross domestic product (GDP) in fiscal and monetary stimulus has been injected in just eight months.

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This, he said, should drive a recovery in consumption from the second half of the year. “We are coming out of two years of consumption slowdown. There are now enough triggers to expect meaningful revival in consumption as we get into the festival season,” he added.

Murarka noted that Renaissance has significant exposure to the consumer space, with around 14–15% of its portfolio in companies such as Godrej Consumer, Jubilant FoodWorks, Whirlpool, Crompton, and Havells. He also highlighted internet businesses as a key long-term growth area, expecting them to contribute up to 10% of the Nifty index over the next five to seven years.

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On defence stocks, he advised caution given high valuations, while in healthcare, he said, it remains a structural growth story driven by rising domestic demand and medical tourism.

Commenting on tariff risks, Murarka said markets are likely to look through near-term deadlines. “These are more negotiating tactics rather than meant to be longer-term tariffs. Markets will overlook the deadline and focus on the broader trend,” he said.

For the full interview, watch the accompanying video

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