'Govt watching rain impact on rural economy, grain supplies'

The government will examine the quantifiable implications of the monsoon shortfall, and the impact on rural consumption and demand, Chief Economic Advisor to the government, V. Anantha Nageswaran said in an interview. Nageswaran also said supply-side measures taken by the government to tame inflation will see success in the medium to long term. Edited excerpts:

- Rhik Kundu

Growth in the coming quarter is expected to be slower than Q1? How do you see it panning out?

We don’t do quarterly forecasts. RBI has come out with an estimate of 6.5%. How they arrived at 6.5% estimates is of less consequence for us. I think we are fine with the quarterly breakdown that the RBI considered. So, overall we are looking at 6.5% real GDP growth (for FY 24). We have indicated that the risks are symmetric around the number. At the moment we don’t have any particular reasons to be concerned about deviating from this.

What are the risks to growth in the coming quarters?

The risks are symmetric. They have always been there. We have to wait and see the quantifiable implications of the monsoon shortfall in August, and its impact on rural consumption and rural incomes. All these things will need to be evaluated. These things will be clearer, as August just got over.

Inflation seems to be a major concern. Some of the issues are structural and cyclical like the vegetable inflation. Grain inflation is also high.