RBI in sync with government on growth focus, says Sitharaman

Union Finance Minister Nirmala Sitharaman, RBI Governor Sanjay Malhotra and Directors at a meeting in New Delhi on February 8, 2025.
| Photo Credit: PTI

With the Reserve Bank of India (RBI) following up the Union Budget’s demand stimulus for the slowing economy with a long-awaited interest rate cut, Finance Minister Nirmala Sitharaman said on Saturday (February 8, 2025) that fiscal and monetary policy working in harmony to spur growth impulses, should yield a bigger boost to the economy.

Ms. Sitharaman was speaking to mediapersons after addressing the RBI’s central board in the capital.

The government expected India’s tepid private investment trends to reverse, Ms. Sitharaman indicated, citing anecdotal inputs from industry leaders received after the Budget that unveiled income tax breaks worth ₹1 lakh crore to jumpstart sputtering urban demand. Industry, she said, was clearly showing signs of a consumption recovery and were reviewing their capacities.

“Whether it is inflation or growth, monetary policy and fiscal policy moving in tandem, like the two wheels of a car, will definitely provide more benefit to our economy and our people. With RBI’s decision on Friday, I am sure that together, things can move in the required direction that we need,” Ms. Sitharaman said.