RBI Monetary Policy June 2022: What is special in credit policy? Economist Brinda Jagirdar explains

RBI MPC Meet outcome June 2022: RBI Governor Shaktikanta Das on Wednesday announced to raise the repo rate by 50 basis points in the monetary policy meeting. The MPC meeting was scheduled for June 6-8. How is the credit policy? What is special in credit policy? Senior Economist Brinda Jagirdar spoke to Zee Business Managing Director Anil Singhvi and expressed her views.

Citing the RBI's decision, Jagirdar said that the situation is challenging not just for India, but the world in general. And with that, the government has maintained the GDP growth at 7.2%.

She further said that the government has not touched GDP growth as capacity utilization is rising, CAPEX and infrastructure expansion are increasing, giving impetus to growth.

But the government's concern about inflation remains said Jagirdar. According to her, this concern is coming from external factors like food, fertilizers, oil, etc. Overall, the situation is challenging, but India's position is much better than other countries right now, the senior economist said.

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Also, a downside is being seen in the power sector, she said. 33% of the bio generated in the power sector is used by manufacturing. So, if something happens in power, it will affect the industry sector which will directly or indirectly affect the GDP. But till now the GDP is on track and there is concern about inflation, she added.

She concluded that the process of increasing the rate will continue for the time being. It will decrease going forward, but "we have to be prepared for seeing more rate hikes," she added.