RBI’s “Revive & Reconstruct” Report: Price Stability A Pre-Condition For Growth: Highlights

For Strong, Sustainable Growth, Price Stability A Pre-Condition:

The theme of the report is “Revive and Reconstruct” in the context of nurturing a durable recovery post-COVID and raising growth in the medium term.

Price stability is a necessary precondition for strong and sustainable growth, an RBI report said on Thursday while stressing a series of structural reforms to nurture a durable recovery post-COVID.

“A feasible range for medium-term steady-state GDP growth in India works out to 6.5 – 8.5 per cent, consistent with the blueprint of reforms,” said the Report on Currency and Finance (RCF) for 2021-22.

The RBI also added the compensation of key managerial personnel and those in senior management roles in NBFCs needs to be reasonable, recognising all relevant factors including adherence to statutory requirements and industry practices.

The Reserve Bank, however, added that the report reflects the views of the contributors and not of the central bank.

Pandemic A Watershed Moment:

The Indian economy is likely to take over 12 years to overcome the COVID-19 losses, according to a report released by the Reserve Bank of India (RBI) on Friday.

In its report on ‘currency and finance for the year 2021-22’, the RBI said, the pandemic is a watershed moment and the ongoing structural changes catalysed by the pandemic can potentially alter the growth trajectory in the medium-term.

The output losses for individual years have been worked out to Rs 19.1 lakh crore, Rs 17.1 lakh crore and Rs 16.4 lakh crore for 2020-21, 2021-22 and 2022-23, respectively.