Mumbai, Dec 6: Reserve Bank Governor Shaktikanta Das on Friday exuded confidence that growth in the second half of the fiscal year would be much better than the April-September period even as the central bank significantly trimmed growth projection for FY25 to 6.6 per cent.
The downward revision in growth forecast follows the second quarter GDP print of 5.4 per cent, the lowest in last seven quarters. It was also below 6.7 per cent growth recorded in the first quarter (April-June).
India recorded a growth of 6 per cent in the first half (April-September period) of the current fiscal.
RBI lowered its growth projection for the current financial year to 6.6 per cent from 7.2 per cent projected earlier.
Going forward, Das said, the second half looks better than the first half of current fiscal year.
The better projection for the second half is based on healthy kharif crop production, higher reservoir levels and better rabi sowing.
Besides, industrial activity is expected to normalise and recover from the lows of the previous quarter. Mining and electricity are also expected to normalise post the monsoon-related disruptions.
With regard to inflation, Das said, it has to be brought down in the interest of sustainable growth.
“The horse (inflation) has made a valiant effort to bolt out, our effort is to keep it on tight leash… there is no scope for knee-jerk reactions. We need more evidence before we take any action and the action has to be timely,” he said in an interaction with media.
The Monetary Policy Committee remains committed to restoring the balance between the inflation and growth which got unsettled recently, he said, adding, RBI will use its various policy instruments to create the conditions for restoring the inflation growth balance. (PTI)
