RBI Governor Das anticipates India’s GDP growth to surpass the 7% milestone in FY23.

RBI Governor Shaktikanta Das made these statements during a CII event, where he discussed various aspects of India’s economy and monetary policy. He highlighted that the agricultural sector, as well as infrastructure and capital expenditure by the government, have contributed to the positive growth outlook. Das mentioned that capacity utilization in the manufacturing sector is around 75%, indicating the potential for further expansion. He also cited surveys indicating a revival in private investment, particularly in the steel and cement industries.

Regarding inflation, Das noted that India’s consumer price inflation (CPI) eased to an 18-month low of 4.7% in April, primarily driven by moderation in food prices. The RBI expects the next CPI reading to be lower than 4.7%, but Das emphasized the need to remain vigilant and stated that the “war on inflation” is not over.

Discussing monetary policy, the RBI Governor indicated that the central bank may take a pause in the coming policy meetings. The decision would depend on the ground-level situation, inflation trends, and economic outlook. The RBI has been proactive in ensuring liquidity availability to support the economy’s production requirements.

Das also touched upon the resilience of the Indian banking sector, highlighting the moderation of non-performing assets (NPA) and improving asset quality. He mentioned that the unaudited gross bad assets of banks until March 31 are lower than 4.4%. The Governor reassured that the banking system remains stable, resilient, and possesses strong capital and liquidity positions.

Furthermore, Das discussed the growth of digital transactions in India, citing a significant increase from 2.28 crore transactions per day in 2016 to 37.75 crore transactions per day at present. He emphasized the RBI’s active support for fintech and digital lending initiatives.

In his speech, Das also addressed global financial turmoil, referring to recent events in Switzerland and the United States related to rising interest rates and banking stress. He highlighted the importance of maintaining financial stability and noted that financial markets remain volatile due to uncertainty surrounding future monetary policy paths.

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