Indian Economic Growth to Move Upwards: RBI Governor
India’s growth troubles appear to be over, and the economy—one of the hardest hit by the Covid-19 pandemic—will see a turnaround and move upwards from here, with the massive spending announced by the Centre, hoping to lift the economy out of one of the world’s worst disruptions caused by the pandemic, the Reserve Bank of India (RBI) Governor, Shaktikanta Das, said.
“The large capital expenditure announced by the government will support economic activity and investment. It is expected to crowd in private investment. From now on, the economy is expected to move only in one direction — that is, upwards,” Das told.
Das added that we need to be cautious about the renewed surge in Covid-19 cases, mentioning that “hopefully the surge in infections will get contained soon.” He said that the central bank will continue to aid the market to function smoothly while ensuring that the Centre and states’ borrowing programmes should not face headwinds. Clarifying the banking regulator stance on Bitcoin, the RBI chief said that the use of “blockchain technology has several positive aspects that need to be exploited”. However, cryptocurrencies such as Bitcoins that are traded, the central bank has raised many.
In its latest World Economic Outlook, the International Monetary Fund (IMF), in January, projected a robust 11.5 per cent growth rate for India in 2021, making the country the only major economy in the world to register double-digit growth this year amidst the coronavirus-triggered economic slump. According to the Economic Survey for 2020-21, the economy is set to grow by 11 per cent in the financial year beginning in April, due to vaccine rollout and rebounding consumer demand. Last month, in its policy statement, the RBI forecast growth of 10.5 per cent for FY22, a notch below the government’s 11 per cent prediction, but a sharp bounce back from the 7.7 per cent contraction in FY21.