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Press Release

India’s economy a bright spot: Chairman, 15th Finance Commission of India

Dec 09, 2023

  • Congruence of fiscal and monetary policy at its best currently 
  • Current challenges call for reinventing of MDBs 

NEW DELHI, 09 December 2023: Addressing FICCI’s 96TH Annual General Meeting and Annual Convention, on the theme- ‘The World’s Growth Engine’, Mr NK Singh, Chairman, Fifteenth Finance Commission of India, Govt of India, said, “India’s economy is a bright spot. The country has rarely been in a position where macro stability and congruence of fiscal and monetary policy is as it is today.” 

Addressing the session on ‘Indian Economy: Navigating through Global Turmoil’, Mr Singh said that there are several factors that are driving India’s growth at present, including a balance between fiscal profligacy and rectitude; unsatiated consumer demand; technology orientation; and migration towards urban centres. “However, it will be important to take the unfinished reform agenda forward. Implementing reforms initiated on factors of production remains important. Also, ensuring predictability and sanctity of contracts remains pertinent for attracting investments and building business confidence,” he added. 

Mr Singh further added that enhancing quality of expenditure will have a multiplier impact on the economy. The Chairman of the 15th Finance Commission of India mentioned that there is a need to restructure centre-state relations in the country and assess what is required to be done differently to make it a shining example of the country’s polity. 

Talking about India’s export potential, Mr Singh noted that no nation has been able to sustain a growth rate of 8-9 per cent without tapping into their exports. “India has a vibrant services sector, however, achieving manufacturing competitiveness is equally important. Harnessing India’s obvious services sector advantage is as important as focusing on manufacturing, and one cannot sustain without the other in the long run,” he said. 

On Multilateral Development Banks (MDBs), Mr Singh said, “MDBs have served well since their inception and have done a remarkable job balancing socio-economic funding requirements. However, prevailing challenges and geo-political situations call for reinventing of the MDBs. Additionally, garnering private capital to support growth remains important. MDBs need to increase their financing support to USD 390 billion by 2030 from about USD 120 billion at present,” he added. 

On India’s position regarding green transition, Mr Singh noted that adhering to voluntary targets for cuts in pollution levels is a right step forward. “We need to look at our own developmental necessities as well,” he added. 

Mr Subhrakant Panda, President, FICCI, and Managing Director, Indian Metals & Ferro Alloys Ltd, said that India’s Q2 GDP numbers are very encouraging, especially for the manufacturing sector. “India is in a sweet spot given the trifecta of a large domestic market, sustainable reforms and favourable demographics that has propelled us into being the world’s growth engine. India’s economic rise isn’t just benefiting its own citizens but also having a salutary impact on the rest of the world,” he said. 

Ms Naina Lal Kidwai, Past President, FICCI, and Chairman, Rothschild & Co India Pvt Ltd and Mr Harsh Pati Singhania, Past President, FICCI, Vice Chair, International Chamber of Commerce (ICC) and Director, JK Organisation, also shared his perspective on the subject.  

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