Reserve Bank of India Governor Shaktikanta Das on Tuesday said India needs to focus and make a clear and unambiguous commitment to bring inflation back to its 4% target.
India’s annual retail inflation fell to 4.75% in May from 4.83% in April, but remains well above the Indian central bank’s medium-term target.
“When it comes to tackling the challenge of inflation, a single mistake can distract you, throw you off track and getting back on track would be much more costly and take much longer,” Mr. . Das during a speech.
We cannot afford to make a mistake, we cannot afford to make a policy mistake,” he said, adding: “There can be no hesitation: “There can be no floating or any distraction at this stage Indeed, any distraction would seriously compromise growth.
Mr Das said that despite the moderation in inflation in May, any severe weather shock could push inflation back above 5% and that with growth remaining robust, the RBI was working to bring you firmly back to your goal.
India’s growth momentum remains strong and could improve further in the coming months, Das said, adding that he was confident the economy would grow at 7.2 per cent this fiscal. current fiscal year, which ends in March.
The South Asian country is on track to achieve 8% growth on a sustainable basis, he added.
The RBI governor also said that private sector capital expenditure has started to recover and there is clear evidence of this revival, which is expected to support growth.
However, to achieve high and sustainable growth, India will need to adopt a multi-sectoral approach and cannot depend solely on exports of manufactured goods or services, Das said.
There is still progress to be made in the agricultural sector, particularly with regard to supply and value chains, he added.
