Inflation is anticipated to decline, according to chief economic adviser V Anantha Nageswaran, reiterating what the Economic Survey predicted earlier this year.
“Given that food prices and international commodity prices are coming down, the RBI expects inflation rate to fall below 6% and head towards 4% by the end of the next financial year (FY24). Trade deficit has also shrunk in the last several months,” he added. The CEA was speaking during the launch of the 2nd G20 Framework Working Group (FWG) of the finance track to be held in Chennai.
Nageswaran added that a number of private groups and analysts now predict that the current account deficit (CAD) will be between 2% and 4% of GDP in FY23 before falling even lower to 1% in the following year. “With global crude oil prices also coming down, the external situation for the country is quite stable,” he said.
Some of the important topics that will be covered during the 2nd FWG in Chennai include the macroeconomic effects of global food and energy insecurity, the cost of climate change, and the best means to make the switch to renewable energy.
“We will focus on sharing country experiences on these issues and discuss how these discussions can be useful to the G20 finance ministers and central bank governors who are set to meet in Washington DC in April,” Nageswaran said.