Chief Economic Adviser V. Anantha Nageswaran on Friday said inflation is peaking and will moderate amid the fall in oil prices and with the onset of monsoon. Participating in the 186th annual general meeting of The Madras Chamber of Commerce and Industry (MCCI) in Chennai, he pointed out that the oil prices have come down in the last three weeks. Monsoon is picking up after a slow start and global commodity prices are easing.
Mr. Nageswaran said the rate hikes by the Reserve Bank of India has been mild when compared to other Central banks. The inflation rate in India at 7% is far better than other countries which have seen 8-10% of inflation. With inflation easing, there might not be a need for further rate hikes by the RBI. The services sector has been doing well, especially in segments, like tourism and hospitality. And private sector has been picking up.
Mr. Nageswaran pointed out that if not for the Russia-Ukraine crisis, the private sector investment would have been far better. Despite pressure from oil prices and other subsidies there has been no change in the Centre’s capital expenditure which is budgeted at ₹7.5 lakh crore for 2022-23. The State governments’ capital spending has also been good, Mr. Nageswaran said.
One of the challenges would be the high current account deficit which will be $100 billion in the current fiscal and in 2023-24 as well. Mr. Nageswaran said with the forex reserves, the situation is manageable. The risks caused by the global economic situation can be managed.
Dr. Venkat Sumantran, chairman, Celeris Technologies, pointed out that the key areas India should focus is on mobility, electronics and defence.
T.R.Kesavan, group president (Corporate Relations & Alliances), TAFE Ltd. has been elected president of the Madras Chamber of Commerce & Industry (MCCI) for the period 2022-2024. Ramkumar Shankar, Managing Director, Chemplast Sanmar Ltd. was elected vice president.
