KOCHI: Even as the global economy is still recovering at a slow pace, the Indian growth story presents a picture of “stability and strength”, despite the recent surge in retail inflation, RBI governor Shaktikanta Das said here on Saturday.
“Inflation has gone up in the last two months, but on the whole, it’s expected to moderate in the coming months. However, the Indian economy is very stable, thanks to factors like the external sector. Our current account deficit last year was 1.1 per cent as against 7 per cent in the 2010-11 period. It is well under control in the first quarter of this year. Our reserves have gone up significantly. The latest figures (Friday) put the same at 675 bn USD, the fourth highest in the world, and enough to meet the requirements of 12 months of imports or meet any other parameters,” Das added, while pointing out that the Indian economy is withstanding global risks.
He was speaking while officially launching the Kochi International Foundation, an intellectual platform of influential personalities from various fields, functioning on the lines of the New Delhi-based India International Centre.
However, he cautioned that there is no room for complacency, citing that there are many challenges like the effects of geo-political conflicts, economic fragmentation resulting in supply-chain disruptions, the challenges of rising import duties, or even the climate change issues.
He also outlined the chief areas on which the country should focus while moving forward – continue with ongoing structural reforms especially that regarding land and labour, adopt a multi-sectoral approach of development, move towards greater formalization of the economy (GST, UPI etc), and widening the credit delivery system.
“The RBI Innovation Hub at Bangalore has come out with a product called Universal Lending Interface (ULI). It’s going to be in a transformational change in credit delivery, like what UPI has done with regard to payment systems in India,” Das said.
The RBI governor also stressed the need to make swift technological advancements.
Earlier, Das observed that the last five or six years have been extremely challenging for the global economy, especially Covid.
“Global growth is holding on. But there are signs that it is (again) slowing down. However, India has been an exception. The economic recovery that India made after the pandemic was one of the best. When every country is facing a growth slowdown, the Indian economy in the last three years, has recorded an annual growth rate of 8 %. The RBI growth projection for the current year is 7.2 % while many international agencies like the IMF have given a growth projection of 7 %. So, on the whole, the Indian growth story remains resilient, Indian economy remains strong and I would say very robust and we are much better placed than perhaps the rest of the world,” the RBI governor added.
Dr M Ramachandran, former Secretary, Ministry of Urban Development, and former Chief Secretary of Uttarakhand, one of the founders of KIF, said the foundation will be an exclusive community of people from business, finance, education, literature, judiciary, science and technology, public administration, sport and culture among others.
“Structured on the lines of various international centres in Indian metros, we would like to set up a world-class facility where minds meet and expand, opinions converge and clash, and connections are forged,” he said.
The other founders of KIF include Justice (Rtd) Satheesachandran; Dr Viju Jacob, Executive Chairman, Synthite Industries; Paul Antony, former Chief Secretary; Dinesh P Thampi, VP and Head of TCS Kerala; Madhu Radhakrishnan, Lawyer and Maria Abraham, Executive Editor, Dhanam Publications.