Reserve Bank of India Governor Shaktikanta Das has expressed confidence that the economic growth rate will be 6.5 percent in the current financial year, while in 2022-23 this figure was 7.2 percent. Also expressed the hope of reducing inflation to 4 percent. In fact, the RBI governor, in his post-monetary policy statement this month, had opined that good rabi crop production, normal monsoon, pick-up in the services sector and moderation in inflation could support domestic consumption. He also said that conditions were favorable to accelerate capital expenditure with economic growth picking up and inflation below 6 per cent, normalizing supply chains and waning uncertainty.
The most important thing that the RBI governor said in his interview to PTI is that the retail inflation has come down due to the thoughtful increase in the policy rate and the measures to improve the supply system at the government level and it will be reduced further. Efforts are on to bring it down to percentage.
No one should object to this optimism of the head of the country’s largest financial institution, but the question is that due to the war between Russia and Ukraine at the international level, uncertainties are still there and there is little certainty about what will happen in the future. Can’t be said. Due to this war, inflation had increased after February-March last year and due to this, food items had become very expensive at the international level and the inflation rate had reached 7.8 percent in April, but as soon as the supply chain There has been improvement, inflation has also come down. In the month of May this year, the inflation had come down to the lowest level of 25 months at 4.25 percent.
The truth is that RBI increases the repo rate as soon as inflation increases. Last year, as soon as inflation increased i.e. the inflation rate reached 7.8, the RBI immediately increased the repo rate by 2.5 and increased the burden of EMI on the borrowers from the bank. Today the situation is very good because the inflation rate is only 4.25 percent. The bottom line is that after Corona and during the Ukraine-Russia war, the country’s economic growth rate is 6.5 percent, inflation is 4 percent and the repo rate is stable, then there can definitely be an increase in the economic growth rate and an increase in employment. However, inflation at half of GDP is always considered good for economic health and RBI is trying to bring the economy to this position. (sp)
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