RBI Governor Says India Remains a Key Driver of Global Growth
The Reserve Bank of India (RBI) has reaffirmed that India continues to act as a key engine of global growth, driven by robust domestic demand, disciplined fiscal policies, and a resilient financial system. Governor Sanjay Malhotra emphasised that despite global headwinds—from geopolitical tensions to trade disruptions—India maintains its competitiveness and stability.
India Leading Global Growth
India’s economic fundamentals remain strong, buoyed by rising domestic spending, healthy capital expenditure, and sustained monetary support. The RBI highlighted that Scheduled Commercial Banks have maintained consistently low non-performing assets (~2.3%) and strong capital buffers. Meanwhile, inflation remains under control, with consumer prices staying below 4%, well within the RBI’s target range.
Financial Stability Strengthens Resilience
Experts note that India’s banking sector is currently in one of its strongest positions in decades, thanks to continuous recapitalisation and stricter credit discipline. Non-banking financial companies and insurance firms also exhibit robust solvency ratios, reinforcing overall stability in the financial system.
Economic Outlook & Potential Risks
Forecast trends indicate GDP growth of approximately 6–7% over the next two fiscal years. However, cautious optimism is advised. While government infrastructure investment remains robust, private investment and job creation are not keeping pace. External factors, such as possible U.S. tariff actions and global trade volatility, also present uncertainties.
What This Means for India
- Growth with stability: Strong demand and controlled prices are creating a stable, high-growth environment.
- Financial sector health: A well-capitalised banking ecosystem makes India better prepared to handle shocks.
- Inside-out investment: Despite macro strength, boosting private capital and workforce engagement remain critical growth levers.
