‘Fiscal policy strongly supportive of growth’

A majority of the respondents to the discussion paper on inflationtargeting framework suggested maintaining the current framework, keeping headline consumer price index (CPI) as the target as there was an agreement the 4 per cent target suits India’s current income level and growth stage, said Poonam Gupta, deputy governor, the Reserve Bank of India (RBI), on Wednesday at Business Standard BFSI Summit in a conversation with A K Bhattacharya

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While India’s policy framework has worked well, are you concerned about two factors: one, there’s growing talk globally of a potential market meltdown. And second, protectionist tendencies are rising, with tariffs almost becoming weaponised. In such a scenario, how should emerging markets, particularly India, navigate a rapidly changing global environment?

■ What India should aspire to be — a developed nation, an emerged nation, or an emerged market — is an important one. These goals go hand in hand as economic prosperity is essential to becoming an emerged nation. The terminology may differ, but the objective remains the same. When an economy grows larger and more prosperous, while maintaining macroeconomic stability and evolving its policy frameworks in line with both domestic and global complexities, it gains greater insulation from external shocks. That’s how countries transition into the advanced-economy club as we've seen with South Korea, which is now close to joining that group.