RBI Governor Shaktikanta Das asserted India’s economy is sound with both the economy and the financial system ready to face global challenges. Speaking at the launch of the Kochi International Foundation, he presented that the Indian economy is stable and robust and is well supported by positive indicators in the external sector.
Das also noted that India’s current account deficit is still within manageable limits at 1.1%. He further underlined the robust character of the country’s external sector, going on to add that one of the world’s largest foreign exchange reserves stand at about $675 billion. According to him, this financial cushion posits India as well-equipped for any uncertainties globally.
The inflation front going by the RBI Governor, he admitted that inflation at 6.2% in October from 5.5% in September on the account of food inflation is likely to ease through normal swings. Comparing it with its Ukraine counterpart, Das of RBI said India had avoided negative interest rates and excessive money printing-the worst inflationary impacts of which other nations had borne, seeing the scenario from the perspective of the economy. Inflation in India is moderating. We expect it to remain on an easy path, he said.
Thus, Das has emphasized RBI’s monetarist policy where he said that sustaining the interest rate at 4% has been helping to recover the economy. He warned the inflationary effects but said that India’s recovery was on track.
On the brighter side, he underlined that structural reforms are necessary, especially in the services sector. While he has highlighted some of the initiatives like UPI which has been quite successful, it has informed him that the RBI is planning to effect transformative changes in the credit delivery systems focusing on small entrepreneurs and farmers, which will further drive economic growth. Economic stability in India and proactive measures by the RBI reflect the nation’s ability to handle external shocks better while maintaining growth.
