RBI Governor Sanjay Malhotra Says India Can Clock GDP Growth Rate Of Over 7 Per Cent

The MPC under the central bank projected the Indian economy to clock a growth rate of 6.7 per cent in the upcoming 2025-26 fiscal year (FY26).

The Reserve Bank of India (RBI) Governor, Sanjay Malhotra, on Friday said that India can definitely clock a growth rate of more than 7 per cent. Speaking at the post-MPC press conference, the governor said that India should aspire to achieve the 7-plus growth rate.

The Monetary Policy Committee (MPC), chaired by the governor, met for the last time in the current 2024-25 fiscal year on Wednesday. Announcing the decision of the panel on Friday, February 7, Malhotra said that the panel has decided unanimously to slash key rates by 25 basis points and the repo rate now stands at 6.25 per cent.

Further, the central bank also projected the economy to clock a growth rate of 6.7 per cent in the upcoming 2025-26 fiscal year (FY26). Elaborating on the economic outlook in the conference, Malhotra said, “I would like to stick my neck out and say that, certainly India can achieve a 7 per cent and plus growth rate. We should certainly aspire for that.”

The governor noted that the income tax relief provided by the Finance Minister Nirmala Sitharaman in her latest budget presentation is expected to control inflation and support growth. “The reduction in tax rates will benefit one crore taxpayers. The Union Budget 2025-26 is 'excellent' from both growth as well as inflation point of view. Focus of the Budget on agriculture will help increase production of pulses, oilseeds and others and bring down food inflation,” the RBI governor said.

Notably, the MPC projected retail inflation for FY26 at 4.2 per cent, while the inflation forecast for FY25 stands at 4.8 per cent. Regarding the Indian rupee, the governor said that the exchange rate policy remained consistent over the years and the banking regulator ‘doesn’t target any specific level or band of the rupee’. On Friday, the rupee recovered 15 paise from its all-time low to close at 87.44 (provisional) against the US dollar.