- Tuesday, February 25, 2025
He said the South Asian economy navigated turmoils such as the Covid-19 pandemic and geopolitical tensions in Ukraine and the Middle East.
By: Shubham Ghosh
THE Indian economy is likely to touch a real GDP (gross domestic product) growth of seven per cent next year, Shakikanta Das, governor of the country’s Reserve Bank of India (RBI) has told Indian channel NDTV in an exclusive interview on the sidelines of the World Economic Forum (WEF) annual meeting in Davos, Switzerland.
He said the South Asian economy, one of the fastest-growing in the world, navigated turmoils such as the Covid-19 pandemic and geopolitical tensions in Ukraine and the Middle East due to a stable macro-economic core.
The central bank chief also said that it continues to closely monitor inflation that breached its target bands during the early months of the Ukraine crisis that started in February 2022, when it touched 7.8 per cent. Das said he expects it to continue moderating as it inches towards four per cent.
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“India has recovered from recent volatilities and uncertainties, such as the health crisis and the geopolitical tensions, and emerged better. (Our) macroeconomic stability is better than most other countries (and) our financial sector is also doing well,” he said in the interview.
“… the seven per cent growth figure, when we said it, it looked optimistic… but now see, the NSO has given a figure of 7.3 per cent (for FY 2023/24),” Das said, referring to advance estimates of annual GDP figures unveiled by the National Statistics Office (NSO) under the ministry of statistics and programme implementation, earlier this month.
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The projections labelled as “preliminary forecasts for 2023/24”, surfaced subsequent to the RBI’s upward revision of its growth projection last month from 6.5 percent. According to the NSO, this growth is anticipated to be driven by the manufacturing sector, constituting approximately 17 percent of the GDP. The sector is projected to witness a year-on-year expansion of 6.5 percent in 2023-24, a significant rise from the mere 1.3 percent reported just a year prior.
According to Das, India has entered a “long-haul growth”. He said, “Aggregate demand conditions remain positive… investment activities are picking up, backed by high capital expenditure (capex) by the government, and private sector capex is also picking up. We expect agriculture to do better too.”
On inflation, the RBI governor said monetary policy actions (taken by the central bank) and supply-side measures pursued by the government have seen headline inflation figures falling.
In an event at Davos this week, Das had said inflation is “under control and within the two-six per cent band we have”.
“The RBI is fully committed to bringing inflation down to the target of four per cent,” he was quoted as saying by NDTV.
