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Expressing optimism over the country’s economic growth, Finance Minister Nirmala Sitharaman has said the Indian economy will stay on course despite global headwinds and is projected to grow at 7% in fiscal 2022-23 (FY23). She attributed this to the conducive domestic policy environment and the government’s focus on key structural reforms to boost growth. She said the global economic outlook is clouded by key downside risks: growth slowdown in major economies, cross-border effects due to the ongoing geopolitical situation, inflationary pressures led by escalating food and energy prices that have adversely impacted vulnerable economies.

She added that the Indian Government has taken initiatives to protect growth while pursuing inflation management. She noted that the government has ensured the availability of free food grains to more than 800 million vulnerable families for the past 25 months, through the country’s massive public distribution network. Last-mile delivery of financial services to the poor has been a key priority of the government and this has been aided by India’s digital public good infrastructure. She also said ‘Today, India is leading the world in terms of digital payments innovations with our transaction cost being the lowest in the world’.

Observing that a key downside risk to global recovery is the exacerbated debt distress in many low-income countries, Sitharaman said it is therefore important that the IMF provides the necessary support to deal with the balance of payments-related vulnerabilities. On climate change, she emphasised the importance of a multilateral approach with the principles of equity and common but differentiated responsibilities and respective capabilities. India has set out an ambitious climate action path through its updated Nationally Determined Contributions that demonstrates India’s commitment at the highest level to decoupling economic growth from greenhouse gas emissions.