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Reserve Bank of India (RBI) Governor Raghuram Rajan said on Friday that though the country is still not on a firm footing to return to high economic growth like in the past, he was confident that it would do so in a matter of couple of years.
Terming the surge in gold imports recently due to relaxation of import norms, and the widening trade gap as one-offs, Rajan expressed confidence that things would return to normal soon with the fall in gold imports. “We are not in a phase of strong growth as yet,” NDTV Profit reported Rajan as saying. “(There is) High possibility that India grows reasonably strong over the next two years.”
The Indian economy this fiscal slipped to its worst growth in a decade, triggering a sense of gloom with investments not reviving even six months after Prime Minister Narendra Modi taking charge of the country in May. While data indicate that project clearances have become quicker, no new investments are coming through, given the high debt levels of companies.
With positive sentiment, the government eased gold import rules, but that led to a surge in imports of the yellow metal, leading to the current account deficit — the excess of spending overseas than its earnings — nearly doubling to 2.1% of the gross domestic product in the September quarter.
Governor Rajan, who forced taxi hailing app Uber Technologies to tweak its offering to comply with the Indian rules of two-factor authentication, said innovations have to fall in line with the regulations. “No matter who you are, you can’t violate regulations,” Rajan had reportedly said. “New technology needs some adjustments in terms of regulations.”