At the opening session of the Kautilya Economic Conclave 2023 in Delhi, prominent figures such as Finance Minister Nirmala Sitharaman and Reserve Bank of India (RBI) Governor Shaktikanta Das delivered insightful speeches. Governor Das shed light on the intricate challenges facing the global economy, emphasizing the delicate balance necessary in policymaking amid these complexities. He highlighted issues such as inflation moderation hurdles, hindrances to growth, and potential risks to financial stability.
The RBI Governor also touched on the heightened sensitivity of financial markets to new information, making policymaking a notably complex task. He underlined the importance of maintaining a fine equilibrium between price and financial stability, citing their mutual reinforcement in the medium to long term.
Discussing the global response, Governor Das outlined the aggressive policy rate hikes by central banks worldwide, with some institutions pausing due to financial stability concerns. He addressed the uncertainty surrounding the duration of high interest rates, reiterating the RBI’s cautious stance.
Governor Das also provided insights into India’s economic outlook, highlighting the RBI’s approach to the evolving inflation outlook and the resilience of India’s economic activity driven by robust domestic demand. He reassured attendees about the stability of the Indian financial sector, emphasizing sustained growth in bank credit and improved asset quality.
His remarks indicated the sector’s capability to meet the minimum capital requirements, reflecting the stability and resilience of the Indian financial landscape amid multiple shocks.
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