“High growth is not sustainable with high inflation. High growth will be possible only with low inflation,” the Reserve Bank of India Deputy Governor, Dr K.C. Chakrabarty, said.
Speaking at an interactive session titled ‘Voice of tomorrow – Fuel to Excel' at the Chamber Hall here, he conceded that there was always a trade off between high growth and inflation, but it would not be possible to sustain growth when inflationary levels are high.
Inflationary pressures
Probably cut up with posers on inflation and interest rate hike, Dr Chakrabarty said, “inflation is an important issue and wherever officials from RBI go, these questions follow. But you must understand that any policy will give result only when people act.”
“The RBI responds to such situation, but do not blame the Reserve Bank for high interest rate,” he said and pointed out that the inflation was more due to supply-side factors at present.
To a query on fuel price hike and the consequent inflationary pressures, he said, “this is not a running commentary of a cricket match. It is a serious job, which requires lots of analysis before making a comment.”
Earlier, addressing the meeting, he urged the youth of the country to work hard and do so collectively. “India's demographic quotient is tilted in our favour. The youth and business captains should therefore strive to take the country to great heights by using technology and being innovative in outlook.
Only collective efforts will help us achieve 10 per cent growth for the next 20 years.” “While we should see how best we can use the demographic quotient to our advantage, it could be a daunting challenge to create employment for 3 million people, but not impossible,” he said and pointed out that ‘in the process the country should look to create skill demographic dividend else it would spell demographic disaster.”
Vocational education
He expressed concern about the ‘poor' skill rate and suggested the need for imparting education and training in vocational stream.
“Over 90 per cent of the workforce is in the unorganised sector. We need more people for agriculture and other sectors, but don't have the capex,” he added.
“Clean and energy efficient business is another area we should focus on besides education and skill development,” the RBI Deputy Governor said.
Advising the youth to give up inter-state and regional disparities, Dr Chakrabarty said, “do the basics right; do not indulge in destructive innovation, look to create millions of micro entrepreneurs.”
The Indian Overseas Bank Chairman and Managing Director, Mr M. Narendra, said while the growth potential was huge, there were also big bets such as in human resource development, on infrastructure front, urban and rural development, economic reforms and so on. “Creative capability and thinking, positive attitude and the vision to achieve great heights would help in continuous improvement. We should not shirk responsibilities but be prepared to sweat out,” he advised the youth.
The meeting was organised by the local chapter of the Indian Chamber of Commerce and Industry with The Hindu as media partner.
The Voice of Tomorrow series is a platform aimed at branding Coimbatore.