One year report card: How economy has performed under RBI Gov Rajan

Raghuram Rajan took over from D Subbarao as the governor of the Reserve Bank of India (RBI) on 4 September, 2014, when the economy was in a clear mess and investor confidence was somewhat absent.

Back then, the rupee hadn’t recovered yet from its lifetime lows and was still trading at 67-levels per dollar, retail inflation numbers were soaring close to double digits giving nightmares to the policymakers, growth was anaemic and foreign investors were dumping local stocks.

One year later, things have certainly changed for good in the economy. Rupee has stabilized, inflation seems to be under control and there are early signs of growth picking up in the economy.

Firstbiz has done a comparison of key macro economic indicators in the last one year, which is, in some way, is the report card of the former IMF chief economist, as the Indian central bank governor.

WPI Inflation
WPI inflation has eased over the year, eventhough in Rajan’s scheme of things wholesale inflation doesn’t assume much significance.

CPI Inflation
Retail inflation, the key price indicator for the RBI, has shown signs of steady decline over the year. CPI stayed below 8 percent for two consecutive months, but economists believe that it is still a bit early for Rajan to declare victory on inflation.

Forex reserves
The country’s forex reserves have improved over the year and stands at over $ 318 billion compared with just about $275 billion around the same time last year.

GDP
Economic growth has picked up momentum, though yet to revert to the high growth path. Most of the growth indicators have improved, reflecting the growing investor confidence in the domestic market and improvement in economic activity.

Rupee

Data compiled by Kishor Kadam