NEW DELHI:  Reserve Bank of India’s (RBI)  Monetary Policy Committee (MPC) member Jayanth R. Varma said on Wednesday that the  biggest risk to India’s growth outlook is an escalation of geopolitical tensions, especially if these tensions spread to the Asian region.

The biggest risk to India’s growth outlook is an escalation of geopolitical tensions, particularly if these worries spread to the Asian region, Reserve Bank of India’s Monetary Policy Committee (MPC) member Jayanth R. Varma said on Wednesday. inflation and inflationary expectations appear to be moderating and high inflation will certainly not become the 'norm' in the country, jayant Varma said.

He said that inflation and inflationary expectations appear to be moderating and high inflation will certainly not become the 'norm' in the country.

Last but not least, Mr. Varma said that inflation and inflationary expectations "appears to be decreasing (both in India and worldwide) and this would remove one of the biggest headwinds for the Indian economy."
Consumer Price Index (CPI)-based retail inflation decreased to 6.71% in July but continued to exceed the RBI's tolerance level for the sixth consecutive month. Retail inflation was expected by the Reserve Bank to average 6.7% in 2022–2023.

On the downside, he said that given the current state of the world economy, exports could not be as robust as they once were. Although India does not have an export-driven economy, a persistent downturn in exports would be detrimental to growth, he added. The escalation of geopolitical tensions, particularly if they move to the Asian region, is the largest threat to the GDP outlook, he said.

On February 24, Russia launched a military operation against Ukraine. Following the aggression, Western countries, especially the United States, sanctioned Russia severely on economic and other fronts.

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