The world is in a tight spot both politically and economically, but India’s Chief Economic Advisor (CEA) V Anantha Nageswaran is confident about the country continuing its upward growth trend even amidst ongoing global challenges.
India remains a rare “bright spot” in a world facing growing uncertainty, said Chief Economic Advisor (CEA) V Anantha Nageswaran, pointing to the country's steady economic performance despite ongoing global challenges.
“To some extent, one can say that the global environment today – whether political, economic or related to security – has become considerably more complicated and more challenging for growth, not just for India but for several countries, almost for the entire world economy,” the CEA said. But, under these circumstances, Nageswaran said he believes that India does indeed stand out as a relatively “bright spot.”
The CEA noted that while conflicts and disruptions have been a part of the global scene since 2022, they have certainly become more intense and unpredictable now. The environment for growth, not only in India, but the world over, is therefore far more difficult – whether political, economic, or security-related, said Nageswaran.
“You could say that downside risks are higher than the potential for upside surprises,” he said, referring to military conflicts in West Asia, between Ukraine and Russia, and also between India and Pakistan, as well as tariff wars.
Pointing towards the upward swing that the Indian economy has exhibited since the Covid-19 pandemic, Nageswaran said the economy’s resilience in achieving strong growth while also improving fiscal health has led to a decrease in the government’s debt levels, which is no easy feat.
According to him, this has helped build confidence among investors, as reflected in the narrowing gap between Indian and US 10-year government bond yields – “something we've never seen at this level before.”
India’s current growth of around 6.5 per cent is a significant achievement, he added, given how tough the global climate has become since the 2008 financial crisis.
While the government continues its efforts to raise the growth rate to 7 per cent and beyond, Nageswaran cautioned that we must be mindful of the fact that the world is no longer operating under the same favourable conditions it once did.
The CEA said that while the government is working hard to grow faster, even maintaining a 6.5 per cent growth rate was applause-worthy in today's world.
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