The recent ‘œgloom and doom’ in India is overdone as the medium-term fundamentals of the economy remain strong, Reserve Bank of India Governor Raghuram Rajan said on Wednesday.
The recent “gloom and doom” in India is overdone as the medium-term fundamentals of the economy remain strong, Reserve Bank of India Governor Raghuram Rajan said on Wednesday.
“We certainly do not need false optimism… but all the doom and gloom is probably overdone,” Rajan said, addressing a media conference shortly after taking charge at the Mint Street here from Duvvuri Subbarao.
He said the economy was passing trough challenging times, but it should not be called a crisis.
“These are not easy times, and the economy faces challenges. At the same time, India is a fundamentally sound economy with a bright future,” he said.
“Our task today is to build a bridge to the future, over the stormy waves produced by global financial markets. I have every confidence we will succeed in doing that,” he added.
Rajan, 50, who was chief economic advisor in the finance ministry, took over as the 23rd governor of the RBI.
He said in his new role at the RBI, he would focus on “transparency and predictability” in the central bank’s functioning.
“At a time when financial markets are volatile, and there is some domestic political uncertainty because of impending elections, the Reserve Bank of India should be a beacon of stability as to its objectives,” he said.
“That is not to say we will never surprise markets with actions. A central bank should never say never, but the public should have a clear framework as to where we are going, and understand how our policy actions fit into that framework,” Rajan said.