The finance ministry said downside risks to growth will persist as India is integrated with the rest of the world and there is no room for complacency on the inflation front. He also said India’s imports are growing faster and hence their comfortable financing should be a high priority.
“Downside risks to growth will persist as India becomes integrated with the rest of the world. There is also no room for complacency on the inflation front, as lower plantings for the Kharif season require skillful management of agricultural stocks and market prices without unduly compromising exports. agriculture,” the finance ministry said in its August monthly report.
Retail inflation in India in August rose to 7% from 6.71% in July. This comes after three months of retail price inflation in India falling from its peak. The Reserve Bank’s MPC has raised its consecutive repo rate three times since May. Inflation based on the consumer price index (CPI) remained above the RBI’s 6% upper tolerance limit for the eighth month in a row and rose despite the central bank’s efforts to contain it. contain.
The department said that despite all the central bank’s hawkish rhetoric, the Federal Reserve’s balance sheet has yet to start shrinking. It grows more slowly. When it actually starts to contract, it may herald a new phase of risk aversion in capital markets, hampering global capital flows.
“With its bright growth prospects, India’s imports are growing faster and hence their comfortable financing should be given high priority. Over the winter months, heightened international attention to energy security in advanced countries could heighten geopolitical tensions, testing India’s shrewd management of its energy needs so far,” he added.
India’s overall imports of both goods and services jumped 33.15% in August 2022 to $75.84 billion in August. The country’s total exports rose 6.75 percent year-on-year to $57.47 billion. The country’s trade deficit widened to $18.37 billion in August 2022. The trade deficit in August 2021 was $3.13 billion. The country’s exports in August 2021 were $53.83 billion, while its imports were $56.96 billion.
“In these uncertain times, it may not be possible to stay content and sit back for long periods. Continued macroeconomic vigilance is the price of stability and sustained growth… Vigilant fiscal management and Prudent monetary policy and credible monetary policy will remain essential for India to achieve its growth aspirations.These two pillars of public policy will reduce benchmark borrowing costs for government and the private sector, thereby facilitating capital formation. public and private sectors,” the report says.
India’s GDP grew by 13.5% in the June quarter 2022 (Q1FY23) compared to the 20.1% growth recorded in Q1 2021-22. Real GDP or Gross Domestic Product (GDP) at constant prices (2011-12) in the first quarter of 2022-23 is expected to reach a level of Rs 36.85 lakh crore, compared to Rs 32.46 lakh crore in the first quarter of 2021-22, showing growth of 13.5% versus 20.1% in Q1 2021-22, according to an official statement.
Read all Latest business news and recent news here