RBI Governor Shaktikanta Das hints at another rate cut

Reserve Bank of India (RBI) Governor Shaktikanta Das on Monday said the central bank is vigilant of the needs of the industry and ready to take action as and when warranted, a remark likely pointing to one more aggressive rate cut in the upcoming monetary policy review on August 6.

“The RBI remains extremely vigilant, does not hesitate to take steps as and when required,” Das assured the industry, addressing the members of the Confederation of Indian Industry (CII).

He, however, said that stability of financial sector entities was important and drew attention towards the growing infrastructure loans of banks.

“The health of lenders is important. Banks’ infra sector NPAs remain elevated and the need is to diversify funding options for the sector,” Das said.

India needs $4.5 trillion investment in the infra sector by 2030.

While Das saw fortunes shifting in favour of rural economy in the midst of the pandemic, India’s share in global value chain continued to be laggard.

He said India can leverage the growing shifts in global value chains and increase its share in them. The conclusion of bilateral trade deals with the US, EU and the UK can bolster India's position in global value chains, he said.