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Chief Economic Advisor (CEA) V Anantha Nageswaran said on Friday that India's economy is projected to grow at a rate of 6.5-7% in the current financial year, despite global challenges.

 

Speaking at a virtual event organised by the Bengal Chamber of Commerce and Industry (BCCI), Nageswaran highlighted that the economy’s growth is commendable given the broader global context.

"The Indian economy is poised to remain the fastest growing in the current financial year with a growth rate of 6.5-7% on a steady-state basis. This is a very good achievement in the current global context," he said.

Nageswaran added that while real growth will be 6.5%, the nominal growth rate, factoring in inflation, is expected to be around 11%. He attributed this resilience to "calibrated fiscal and monetary policies" implemented by the government, which have solidified India's post-COVID recovery.

"Post-COVID recovery in India is cemented due to prudent macroeconomic management, which laid the foundation of economic growth with stability," he noted.

Nageswaran also said that India's current account balance is stable, with a robust domestic financial market and banking system. "The macro indicators signal stability. There has been a massive shift in capital expenditure, a declining external debt-to-GDP ratio, and lower retail inflation," he said, emphasising that these factors support a positive outlook.

 

Discussing future challenges, Nageswaran stressed the importance of finding domestic growth drivers, including generating productive employment, improving food security, and addressing regulatory challenges faced by MSMEs.

 

He also urged the need for greater female participation in the workforce, saying, "Safety and security in workplaces must be ensured for women to take part in the workforce."

 

Regarding the impact of technology, especially artificial intelligence (AI), he cautioned, "An appropriate balance has to be struck between technology and labour, keeping social responsibilities in mind."

 

Looking ahead, Nageswaran expressed confidence in the economy's potential for steady growth over the next several years, crediting strengthened supply-side capabilities for helping to keep inflation in check.