A meeting of the Parliamentary Standing Committee on Finance on Thursday saw concerns being raised over the falling value of the rupee and sluggish private investment, even as government officials maintained that India’s economy continues to strengthen despite global headwinds.
The committee, chaired by BJP MP Bhartruhari Mahtab, heard a presentation from Economic Affairs Secretary Anuradha Thakur and Chief Economic Adviser V Anantha Nageswaran on the current economic situation, followed by detailed discussions on emerging macroeconomic trends.
Addressing reporters after the meeting, Mahtab said issues such as rising prices, inflation, geopolitical tensions in West Asia, and China’s protective industrial policies were discussed.
“While there are still certain headwinds, India’s economy is emerging in a stronger position despite these serious challenges,” he said.
He noted that several indicators remain encouraging, including higher household savings and rising overall investment. However, he flagged private sector investment as a key concern.
“Government capital expenditure is increasing, but private investment has not been picking up at the same pace. This is an issue that needs to be addressed,” he said.
The committee is expected to reconvene in the third week of the month and prepare a report outlining both challenges and policy recommendations.
Mahtab also acknowledged that MPs raised concerns about the rupee’s decline, saying the Reserve Bank of India is taking steps to manage volatility.
On private investment, he said policy adjustments may be required, particularly to attract firms relocating from China and to improve India’s competitiveness as a manufacturing destination.
Discussions also touched on India’s proposed trade agreement with the United States, as well as broader global investment trends.
Mahtab said members were briefed on shifting foreign direct investment (FDI) patterns, noting both inflows into India and outflows from the country. He cited officials who described these movements as cyclical.
He added that the United States is increasingly attracting global investment, while higher interest rates in several developed economies are also influencing capital flows. “Earlier, emerging economies were receiving most of the investment. That trend is changing,” he said.
Despite these challenges, Mahtab expressed confidence in India’s economic resilience, pointing to its large domestic market and ongoing policy measures, including government-backed support funds.
(With inputs from PTI)
