India in striking distance of 8% growth as reforms boost economy: Shaktikanta Das

Mumbai: India is expected to remain the fastest-expanding major economy on the planet, boosted by policy stability and reforms that are aimed at reducing import dependence, Shaktikanta Das, principal secretary-2 to the Prime Minister and former central bank governor, said at a media event in Mumbai Tuesday.

"India is in striking distance of 8% growth, with the economy being powered by the triple engines of macroeconomic stability; continuing structural reforms; and strategic policy initiatives to develop domestic capacity where we are largely import dependent," Das said. "The seeds of our future and long-term growth are being sown today."

Also Read: India's growth momentum stays resilient despite global headwinds: RBI Deputy Governor Poonam Gupta


He also highlighted the role of the financing sector in powering growth and helping India become a developed economy.

Das said the BFSI sector has a crucial role to play in India's journey from a lower-middle-income economy to a high-income economy, through its intermediation in allocation of financial resources. He said the sector would be required to support India's next-gen Digital Public Infrastructure (DPI), be the frontline of green and transition finance and become the catalyst for democratising financial inclusion to support this journey.

Also Read: China's money may find a chink in India's rulebook

The sector has to play an important role in funding the creation of digital carbon markets, issuing sovereign green bonds, and offering competitive financing products for green hydrogen and renewable energy infrastructure. Calling micro, small and medium enterprises and agriculture as the engines of India's economy, Das said that these sectors will have to be empowered. "This would call for reliance on alternative digital footprints such as GST records and account aggregation for instant, algorithmic credit underwriting. The full scale roll out of the Unified Lending Interface (ULI) by the RBI would be a game changer in this context," he said.

The sector should also focus on deepening financialisation of savings by redirecting India's domestic wealth from physical assets (like gold and real estate) into productive financial assets through micro-investment and mutual fund products.

Das said the BFSI sector has to support India's next-gen DPI which will include globalisation of UPI; expansion of real-time cross-border payment linkages to reduce remittance costs and friction in international trade settlements; and greater deployment of CBDC for wider adoption.

"India's success in its march towards Viksit Bharat, despite the ongoing turbulent global conditions, will depend on a sound, efficient and profitable BFSI sector," Das said.