Former RBI Governor C Rangarajan on Monday said he expects the economy to grow about 6.5 per cent this fiscal.

“Indian economy is coming out of a phase of slow growth. Going ahead, over the next two quarters the rate of growth will be slightly higher and for the fiscal year as whole, it should be 6.5 per cent,” Rangarajan told BusinessLine on the sidelines of ‘Inclusive Finance India Summit 2017’ here.

The summit saw four former RBI Governors — Rangarajan, YV Reddy, Bimal Jalan and Subbarao — sharing a platform that would discuss financial inclusion issues over two days. Former RBI Deputy Governors Subir Gokarn and HR Khan were also present on the occasion.

Rangarajan said even the 6.3 per cent GDP growth in the second quarter is better than before although certainly not very high.

Indian economy had recorded 7.1 per cent growth in 2016-17 and 5.7 per cent in first quarter this fiscal. On inflation, Rangarajan said it is difficult to forecast short-term inflation. “My own view is probably inflation will be little over 4 per cent (by March 2018) as one does not know what will happen to oil prices. But the improvement in agriculture should have favourable impact on agriculture prices,” he said.

Earlier, speaking at the summit, Rangarajan described as “somewhat disturbing” the kind of consolidation that is happening among regional rural banks, stating that the local character of the RRBs is getting diluted by such an approach. This is somewhat of regression than forward movement, Rangarajan said

Related Topics