Union Finance Minister Nirmala Sitharaman expressed optimism about a potential soft landing for the global economy, noting the stabilizing effect of coordinated actions among countries and multilateral financial institutions. Speaking at the Centre for Strategic and International Studies (CSIS) in Washington, DC, she emphasized that inflation has been controlled effectively, allowing the global economy to slowly move toward recovery.
However, she cautioned that economic growth remains moderate, with advanced economies showing limited demand, thus impacting global trade and commodity-dependent nations. Highlighting fiscal challenges, she acknowledged that many countries face the task of managing high fiscal deficits due to pandemic-related borrowing.
Regarding India, Sitharaman stressed the country’s focus on growth driven by a strong domestic market, but noted that increased imports and slow recovery in traditional export markets are presenting external challenges. She raised the question of what may be holding back further foreign investment, despite India’s favorable attributes, such as a young skilled workforce, shared democratic values, and robust FDI inflows. Reassuringly, she emphasized that India’s economic policies and reforms are advancing, aiming to boost investor interest even further.
