India’s central bank governor, Raghuram Rajan, being extremely positive on the economy, pointed to the green shoots that have now started showing up in the investment climate. Besides, he also asserted that while the rates of stalled projects were coming down, investment intentions were picking up with the economy beginning to see the start of an investment cycle. Data put out by Centre for Monitoring Indian Economy (CMIE) on Tuesday also points out to a revival in investment growth. He however, cautioned that these were just early signs and not calls for celebration.
Further, the governor also refrained from commenting on the new series on economic growth numbers by the Central Statistics Office (CSO) and said that he was trying to understand the new series as he felt that determining potential growth wasn’t that easy with such a short series of data.
The governor emphasized that as the growth process for the country kick-starts, the government would have to be mindful of on issues relating to fuelling such expansion with sufficient funding options. He also drew some attention of government to capital needs of PSU banks and highlighted that there was some room for the banks, especially the state-run ones to access the markets to raise capital from the market over and above what they can do from the government.