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Expressing optimism over India’s economic growth, Niti Aayog Vice Chairman Rajiv Kumar has said that the country is on the cusp of a major economic recovery and talks of possible stagflation are ‘overhyped’ as a strong economic foundation is being laid with the reforms carried out by the government over the last seven years. Notwithstanding economic uncertainties triggered by the Russia-Ukraine war that is also impacting global supply chains, Kumar asserted that it was quite clear from all accounts that India will remain the fastest growing economy in the world.

He said ‘given all the reforms that we have done in the last seven years, and given that we are seeing the end of the COVID-19 pandemic hopefully, and the 7.8 per cent rate of growth that we will get this year (2022-23), a very strong foundation is now being laid for further rapid increase in economic growth in the coming years’. He acknowledged that because of the Russia-Ukraine war, India’s GDP growth projection could be revised. He added that ‘But even then, India will remain the fastest growing economy and all the other economic parameters are actually quite within the range’.

On rising inflation, the Niti Aayog Vice Chairman said that RBI is keeping a close watch as per its mandate. He said ‘I am sure that the RBI is well in control of it (inflation) and will take the necessary steps if and when required’. Regarding concerns over possible risk of stagflation, he said the Indian economy is projected to grow 7.8 per cent in the current fiscal and this is nowhere near the definition of stagflation. he emphasized ‘I think this has been overhyped, because when you talk about stagflation, we talk about growth rates which are much below your rate of growth or potential output, which is not true at all for this time’.

Regarding high petrol and diesel prices, Kumar said that given the global situation, fuel prices are rising across the world. He said ‘In the past, the government had taken steps to reduce the tax burden. And I think, it’s time now for the states to come forward if they feel that this is required to be done’. He asserted in any case, the government keeps a close watch on prices of all commodities including fuel and will take steps as necessary. Rates of petrol and diesel are rising, and vary from state to state depending upon the incidence of local taxation.