Purbalee Dutta 
Despite global challenges like trade tensions, rising debt, and geopolitical disruptions, financial conditions have improved, and banking systems remain largely stable, said Reserve Bank of India (RBI) Governor Sanjay Malhotra on Friday. Speaking at the fourth Kautilya Conclave in New Delhi, he highlighted India’s unique position as a stable anchor amid worldwide uncertainty. He attributed this to India’s strong macroeconomic fundamentals, including robust foreign exchange reserves, low inflation since February, a shrinking current account deficit, and healthy bank balance sheets—all built over many years. Malhotra praised policymakers, regulators, and market players for maintaining this resilience, contrasting India’s stability with the fragility seen in advanced economies.
He also noted how central banks globally have shifted from solely maintaining price stability to actively responding to crises like the 2008 financial crisis, the eurozone debt crisis, the COVID-19 pandemic, the Ukraine conflict, and climate challenges. For India, this meant combining aggressive monetary easing during the pandemic with targeted liquidity support and a swift tightening of policies when inflation rose in 2022. Malhotra emphasized coordination with fiscal policy, which helped ease supply issues while maintaining consolidation, preventing food-price shocks from affecting core inflation.
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