Emphasising that the Indian economy is now at a critical juncture the Reserve Bank of India (RBI) Governor Shaktikanta Das stated that the country is now geared for orbital shifts. Speaking at an industry event, Das noted that there was a need to cut down the noise regarding the country’s growth debate and called for the need to analyse where India’s growth story currently stands.
Delivering his address on ‘India at an Inflexion Point: Some thoughts’ at the Fibac 2024- Banking for Viksit Bharat, Das stated that the high growth forecasts regarding the Indian economy by the agencies and the apex bank are converging by noting that the country has recovered from the Covid disruptions on a strong note and has grown at an impressive 8.3 per cent in the past three years.
Commenting on the recent economic data which highlighted the slowdown in the country’s gross domestic product (GDP) during the Q1FY25, Das stated that despite the below-expectation growth numbers, the real drivers of the economy are gaining momentum, thus providing confidence to state that the country’s growth story is intact.
Das pointed out the revival of rural demand by highlighting that private consumption has rebounded to an impressive 7.4 per cent as compared with a weak 4 per cent in the second half of the previous fiscal. Pointing out that around 90 per cent of GDP (56 per cent Consumption and 35 per cent investment) has grown at a healthy pace, Das stated that the other major driver of growth, Investment has grown by 7.5 per cent.
As per the RBI Governor, the low numbers for the previous quarters came on the back of muted public spending on the part of both the Central and State governments due to the general elections. The apex bank governor stated that the government capex is likely to pick up pace in the upcoming quarters.
