Raghuram Rajan, the new governor of RBI, believes that the economic mess that the country finds herself in is not structural and can be fixed in incremental steps

Moneylife Digital Team

While admitting that the Indian economy has serious problems to overcome, Raghuram Rajan, the new governor of Reserve Bank of India (RBI) believes that the very problems that India finds herself in, namely the current account deficit and balance of payment crises are not structural in nature, and can be fixed by incremental reforms.

“For the most part, India’s current growth slowdown and its fiscal and current-account deficits are not structural problems. They can all be fixed by means of modest reforms,” wrote Rajan in Project Syndicate, an economic think-tank. He added, “Indeed, despite its shortcomings, India’s GDP will probably grow by 5%-5.5% this year – not great, but certainly not bad for what is likely to be a low point in economic performance.”

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