Need to initiate policies that enhance domestic capacities: Subir Gokarn, Deputy Governor, RBI

NEW DELHI: RBI Deputy Governor Subir Gokarn said that India needs to initiate policies that enhance domestic capacities in order to offset the world pressure.

He was speaking at a session on Macro-economic Issues and Challenges to India's growth, organised by the PHD Chamber of Commerce and Industry in New Delhi.

"Interest rates are double edged swords. However, the slowdown cannot be attributed entirely to interest rates," said Gokarn. He was also of the view that people should pay the right price of energy. He further said, "Persistent food inflation has become endemic thereby overpowering good monetary policies."

The event focused on the onset of the sovereign debt crisis in the Euro-Zone and its impact on advanced and emerging economies.

The event was attended by Satya Bansal, Chief Executive at Barclays Wealth, V Kannan Executive Director at Oriental Bank of Commerce and Dr. BB Bhattacharya, eminent Economist and former VC, JNU.

President PHD Chamber, Sandip Somany said, "On domestic macroeconomic concerns, the current situation is by far the most difficult.

Infrastructural bottlenecks in power, coal, and transport seem to have worsened, causing serious supply side pressures.

With weaknesses in power and aviation sectors, public-private-partnership projects are getting impacted, which entails the risk of lowering private investment in infrastructure."