New Delhi:
India’s gross domestic product in fiscal year 2022-2023 could exceed the estimated 7 percent, Reserve Bank of India governor Shaktikanta Das said.
“I will not be surprised if GDP growth is slightly above 7 percent,” Shaktikanta Das said at a Confederation of Indian Industry event here in New Delhi. He said this based on strength in several macro fundamentals.
The Economic Survey paper for 2022-23, published earlier this year, predicted that India could grow by 7 percent. The Economic Survey forecasts base GDP growth of 6.5 percent in real terms for the next fiscal year 2023-2024.
Speaking about India’s monetary policy and what the future move might be, he said it was not in his hands but depended on several factors on the ground.
“It’s not in my hands. It all depends on the situation on the ground. I’m driven by what’s happening on the ground and what the outlook is on the ground and what the trends are or how inflation is coming down.”
The RBI, at its first monetary policy review meeting of the fiscal year in April, decided to leave the main benchmark rate – the repo rate (the rate at which the RBI lends to other banks) – unchanged at 6.5 percent, to assess the effects of the policy rate cuts implemented so far.
The central bank conducts six bimonthly reviews of its monetary policy in a fiscal year.
Apart from the recent pause, the RBI has raised the repo rate by 250 basis points cumulatively since May 2022 in the fight against inflation. Raising interest rates is a monetary policy tool that usually helps suppress demand in the economy, thereby lowering inflation.
Mr. Das told the meeting at the CII event that the recent repo rate decision (leaving it unchanged) should be seen as a pause in monetary policy, not a pivot.
The next RBI monetary policy review meeting is scheduled for June 6-8, 2023.
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