Reserve Bank of India (RBI) Governor Shaktikanta Das asserted that the Indian economy is robust enough to withstand global economic shocks, showcasing stability and resilience in the face of challenges. Speaking at the launch of the Kochi International Foundation, Das highlighted India’s economic growth, strong external sector, and effective monetary policies as key contributors to the nation’s economic stability.
‘The Indian economy presents a picture of stability and strength today,’ Das remarked. He noted that the current account deficit (CAD) is under control, standing at 1.1% of GDP—significantly lower than the 6–7% seen in 2010 and 2011. Further bolstering confidence, India’s foreign exchange reserves remain among the highest globally at approximately $675 billion.
Addressing inflation concerns, the RBI Governor acknowledged its rise to 6.2% in October from 5.5% in September, primarily driven by food prices. However, he emphasized that inflation is expected to moderate, using a metaphor to describe it as an “elephant in the room” that has momentarily stepped out but will soon return to the forest.
Das credited the RBI’s strategic monetary policies for containing inflation. Unlike several other nations, India refrained from excessive currency printing during economic turmoil. “If we start printing notes, the problems we aim to resolve would expand beyond control,” he cautioned.
Reflecting on the RBI’s approach during the Ukraine war, Das underscored that maintaining interest rates at 4% facilitated a smoother recovery. ‘Our focus on the right monetary policies kept the price spiral in check, ensuring a balanced approach to growth and stability,’ he said.
The Governor also highlighted India’s advancements in digital financial infrastructure, particularly the Unified Payments Interface (UPI) and the recently launched Unified Lending Interface (ULI), which aim to revolutionize credit delivery for small entrepreneurs and farmers.
