Speeches & Media Interactions

Moderator: Thank you, Governor. Lots of interesting comments you made in your speech. I would like to start with what you said towards the end, where you said, in your interaction with some bank CEOs, they had some areas of concern and I remember at the time when the RBI had raised the risk weights on unsecured loans, you had called it a pre-emptive measure. So, are there any other areas which make you a little bit worried and where you will now direct your lens with more intensity?

Good afternoon everyone and welcome to the Post-Monetary Policy Press Conference of the Reserve Bank of India. This is the last of this calendar year and I would like to welcome all media friends to this Press Conference. Today, we have with us Honorable Governor Shri Shaktikanta Das, Deputy Governors – Dr. M. D. Patra, Shri M. Rajeshwar Rao, Shri T. Rabi Sankar, and Shri J. Swaminathan. We also have with us today, our Executive Directors Dr. O. P. Mall and Dr. Rajiv Ranjan.

Raghuvir Srinivasan, Editor, Business Line:

Recognition of the Reserve Bank's adroit handling of monetary policy and regulations over the last three years especially since the interest rate cycle turned a year and a half ago. I would like to ask you two or three questions very quickly. The first is you will go down in history as the only Governor of the Reserve Bank of India who had the job to guide the country and the economy during a calamity that the country faced. Now, I would like to understand your thought process when you were so super active during the COVID period. The moment COVID was announced you opened up communication with the markets and with the press very quickly; going in front of the cameras and addressing people. Now what was your thought process when you went through that difficult period helming the RBI?

Moderator:

Thank you so much Sir, for joining us today. Ladies and gentlemen, as you all are aware the Governor Mr. Shaktikanta Das has been rated as the Top Central Banker Globally by Global Finance Magazine. He is also being conferred with the Governor of the Year Award at Central Banking Award 2023. He has cemented his position as someone who is adept at really making critical reforms. He has overseen the world's most innovative leading payments and its innovation and stirred India through difficult times and is playing an instrumental role in catapulting India into global arenas with his crystal clarity, intuitive originality, his analytical mastery, and most importantly, his ability to navigate through the clutter and come up with razor-sharp perspectives. Ladies and gentlemen, a big, big applause for Mr. Shaktikanta Das, Governor, Reserve Bank of India.

Welcome to the 2023 Annual Meetings Governor Series Talk. I am Krishna Srinivasan, Director of the Asia Pacific Department of the International Monetary Fund. Today, I am honored and privileged to welcome Governor, Shaktikanta Das of the RBI. We will be talking about the frontiers of central banking in Asia.

Governor Das requires no introduction, but I will do my obligatory piece here. Governor Das took over the helm of the RBI in 2018 at a critical moment for both India and the world and since then, he has been guiding monetary policy and banking regulation in the world's fifth-largest economy. During the COVID-19 pandemic, he took bold and timely actions to mitigate the impact of the pandemic and to save lives and livelihoods. He is passionate about digital technology and fintech, both geared towards increasing access of the layman or a common person to finance and promote financial literacy.

Participants from the RBI:

Shri Shaktikanta Das – Governor, Reserve Bank of India
Dr. Michael D. Patra – Deputy Governor, Reserve Bank of India
Shri M. Rajeshwar Rao – Deputy Governor, Reserve Bank of India
Shri T. Rabi Sankar – Deputy Governor, Reserve Bank of India
Shri Swaminathan J. – Deputy Governor, Reserve Bank of India
Dr. O. P. Mall – Executive Director, Reserve Bank of India
Dr. Rajiv Ranjan – Executive Director, Reserve Bank of India

Moderator:
Shri Yogesh Dayal – Chief General Manager, Reserve Bank of India

Yogesh Dayal:
Hello everyone and welcome to the Reserve Bank of India for this post- Monetary policy press conference. As always, we have here our respected Governor Shri Shaktikanta Das and along with him, our Deputy Governors; Dr. M. D. Patra, Shri M. Rajeshwar Rao, Shri T. Rabi Sankar, Shri Swaminathan J. and also with us today, our Executive Directors Dr. O. P. Mall and Dr. Rajiv Ranjan. With this, I welcome all of you to the RBI’s press conference and before going ahead with the press conference, I will request the Governor to make a few opening remarks. Over to you Sir.

Shaktikanta Das:
Thank you. As I have done on previous occasions, I would like to summarise whatever I have said in my statement, and I have nine points very quickly.

1. Domestic economic activity continues to be resilient. India is poised to become the new growth engine of the world.

2. Declining core inflation is a silver line. But headline CPI inflation remains vulnerable to recurring and overlapping food price shocks.

3. The MPC remains highly alert and will not hesitate to take timely and appropriate action if the situation warrants.

4. It is emphatically reiterated that the inflation target is 4% and not 2% to 6%. Hence, monetary policy needs to remain actively disinflationary at the current juncture.

5. Liquidity will be actively managed consistent with the monetary policy stance. OMO sales will be undertaken, as necessary.

6. Banks with surplus funds are encouraged to lend in the interbank call market for better returns instead of passively parking them in the SDF.

7. The financial sector balance sheet remains robust, while the Reserve Bank is closely monitoring the emerging trends. Banks and NBFCs are expected to strengthen their internal surveillance mechanisms and institute suitable safeguards wherever necessary.

8. Financial stability is fundamental to price stability and growth. That is the core principle which we follow.

9. The external sector is eminently manageable.

Thank you.

Yogesh Dayal:
Thank you Sir for those opening remarks. I will begin the press conference by inviting Mr. Anup Roy from Bloomberg to ask his question.

Anup Roy, Bloomberg:
Sir, this is regarding the OMO announcement that you did. So, will there be a calendar for OMO and is this in preparation for the JP Morgan bond index inclusion?

Shaktikanta Das:
As I have said in my statement, the first thing I would like to say is that it has nothing to do with the bond index inclusion and let me reiterate that it is a part of our domestic liquidity management. With regard to the calendar, I have said that we will watch the evolving trends. There are several moving parts in the whole liquidity scenario. We will watch the evolving trends and we will notify as and when it becomes necessary. So, we do not, at the moment, propose to give a calendar.

Participants from the RBI: Shri Shaktikanta Das – Governor, Reserve Bank of India Dr. Michael D. Patra – Deputy Governor, Reserve Bank of India Shri M. Rajeshwar Rao – Deputy Governor, Reserve Bank of India Shri T. Rabi Sankar – Deputy Governor, Reserve Bank of India Shri Swaminathan J. – Deputy Governor, Reserve Bank of India Dr. O. P. Mall – Executive Director, Reserve Bank of India Dr. Rajiv Ranjan – Executive Director, Reserve Bank of India Moderator:
Shri Yogesh Dayal – Chief General Manager, Reserve Bank of India

Participants from the RBI: Shri Shaktikanta Das – Governor, Reserve Bank of India Shri M. K. Jain – Deputy Governor, Reserve Bank of India Dr. Michael D. Patra – Deputy

CNN Reserve Bank of India Governor. It is good to see your message on the growth of India, but at the same time, you are not immune to the spillover effects of both the slowdown in the West or the other countries, and the higher inflation rates and interest rates. Shaktikanta Das On growth, the year which we just concluded on 31st of March, i.e., the financial year 2022-23; India is expected to have recorded GDP growth of 7.0%. For the current financial year, i.e., Ap