Amidst ongoing tariff war unleashed by US President Donald Trump and his remarks of India being a "dead economy," Reserve Bank of India (RBI) Governor Sanjay Malhotra on Wednesday said economy is "doing very well." He also said Indian economy is contributing more to global growth than the US.
Making this assertion, Malhotra said here India is expected to grow 6.5 per cent, as against the International Monetary Fund's (IMF's) estimate of about 3 per cent global growth in 2025.
"We are contributing about 18 per cent, which is more than the US, where the contribution is expected to be much less — about 11 per cent or something. We are doing very well and we will continue to improve further," the RBI Governor said, replying to a question on Trump's recent comments.
Malhotra said the aspirational growth rate for India should be more than 6.5 per cent, which the RBI is projecting for FY25, and added that the country has grown at a yearly average of 7.8 per cent in the past.
Amid the trade policy negotiations, Trump had called India as a "dead economy" while expressing disappointment with New Delhi's posturing to continue buying cheap oil from Russia. "I don't care what India does with Russia. They can take their dead economies down together," Trump had reportedly said.
This statement and the ones following that were as sharp a critique, while having the potential to destabilise the India-US relationship, have also led to concerns over exact tariffs and penalties for buying Russian oil that await India from the Trump administration.
Malhotra said the RBI does not expect any impact on inflation because of the tariff-related aspects, while Deputy Governor Poonam Gupta elaborated that there will not be any first order impact of the geopolitical issues on the domestic inflation.
Even in the event of India being forced to shift away from Russian oil because of US concerns, there will not be any impact on domestic inflation, Malhotra said.
He said this fiscal year, authorities will step in to ensure that the purchase prices of petroleum prices do not pinch the common man, hinting of a possible cut in duties if the oil becomes dearer.