This statement follows PM Modi’s appeal for voluntary austerity measures aimed at safeguarding foreign exchange reserves, which suggest lowering gas and diesel usage and postponing gold purchases.
This announcement comes after the Centre’s decision on Tuesday to double the customs duty on gold.
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Malhotra made these comments during a conference organized by the Swiss National Bank and the International Monetary Fund in Switzerland on Tuesday.
Despite the government’s efforts to manage rising petroleum costs, India’s inflation rate increased from 3.40% in March to 3.48% in April. Nevertheless, the outlook remains precarious due to escalating energy prices linked to the conflict in the Middle East.
India is beginning to face supply-chain challenges in the region.
The RBI forecasts growth at 6.9% for this fiscal year, with an average inflation rate of 4.6%. However, analysts predict that the ongoing conflict could drive inflation higher and further slow down economic growth. In April, the RBI held its key policy repurchase rate steady at 5.25%.
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