International Monetary Fund (IMF) Senior Resident Representative for India, Nepal and Bhutan Thomas Richardson has said that India is exposed to global risks but much less than other emerging markets and is better placed among them to tackle risks arising out of global economic slowdown reaffirming an optimistic outlook despite some lingering concerns. He said that the Indian central bank with its Chinese counterpart are the only ones ready to handle huge outflows as both RBI and the People's Bank of China are armed with an insurance policy in the form of foreign exchange reserves.
This statement has come after IMF lowered India’s growth forecast to 7.3 percent this year from earlier 7.5 percent amid risks of a global slowdown in its latest World Economic Outlook (WEO) Update . Richardson further said 'India has been lucky with global commodity prices coming down. But also policy has a role to play’ giving stress on many macro indicators such as lower current account deficit, easing of inflation, and a check on fiscal deficit
He further appreciated Reserve Bank of India governor Raghuram Rajan's policy initiatives has helped the country build sizeable foreign exchange reserves of over $350 billion in case there's a pullout by foreign investors and initiatives that have helped to check consumer inflation. Richardson however has warned that there are the drawbacks which are dragging things down such as the corporate leverage and non-performing loans in the banking sector. Besides, there are concerns about government finances as well.