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‘We have provided ample liquidity to the banking sector and whatever else is required to support the growth of the economy,’ says RBI Governor Sanjay Malhotra.
RBI Sanjay Malhotra emphasised that while anchoring inflation has been a key priority, the central bank has “not lost sight of growth amid uncertainties”.
The Reserve Bank of India (RBI) will step in with additional policy measures if the recently imposed 50% US tariffs, effective from Wednesday, begin to weigh on domestic economic growth, Governor Sanjay Malhotra said on Monday.
Speaking at the FICCI-IBA annual banking conclave, Malhotra noted, “We have provided ample liquidity to the banking sector and whatever else is required to support the growth of the economy and including those of sectors which are impacted more. If it so happens, we will not be found wanting in our job.”
He emphasised that while anchoring inflation has been a key priority, the central bank has “not lost sight of growth amid uncertainties”.
The RBI has already cut the policy repo rate by 100 basis points between February and June, bringing it down to 5.5%. The rate was left unchanged in the August review.
Malhotra recalled that the central bank had trimmed its FY26 GDP growth projection to 6.5% in April, soon after the US had floated the idea of 26% tariffs. The Donald Trump administration later went further, imposing an additional 25% duty on Indian goods in response to India’s energy purchases from Russia.
While he expects the overall economic impact of these tariffs to remain limited, Malhotra pointed out that some industries could face stress. “There are sectors like gems and jewellery, textiles, apparel, shrinks, MSMEs, where there could be potential impact,” he said.
The governor added that policy coordination remains key, with the government advancing free trade agreements to cushion the blow. “The government is also looking at free trade agreements, some of which have already been in the works for some time. And we, on our part from the Reserve Bank, we have, as you are aware, we have been on an easing cycle. We reduced the repo rate by 100 basis points,” he said.
Haris is Deputy News Editor (Business) at news18.com. He writes on various issues related to personal finance, markets, economy and companies. Having over a decade of experience in financial journalism, Haris h…Read More
Haris is Deputy News Editor (Business) at news18.com. He writes on various issues related to personal finance, markets, economy and companies. Having over a decade of experience in financial journalism, Haris h… Read More
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