UPI's international linkages show it can be global model for cross-border payments: RBI governor Das

The linkage of the India’s Unified Payments Interface and the fast payment systems of a few other countries drives home the potential of the UPI to become an international model for cross-border payments, Reserve Bank of India Governor Shaktikanta Das said on Thursday. Addressing the 59th SEACEN Governor’s Conference in Mumbai, Das suggested five possible policy choices for the future course of the global economy as new realities take shape in the years to come. “Our sustained engagement in the India Stack and the Unified Payments Interface (UPI), especially during the pandemic and thereafter, has given us the confidence that digital public infrastructure can become a critical part of global public good when scaled up beyond national boundaries,” he said. The RBI is the current Chair of the SEACEN (South East Asian Central Banks) forum. ‘Stable & low inflation will provide necessary bedrock for sustainable economic growth’ Das further said recurring food price shocks and renewed flash points on the geo-political front pose challenges in tackling inflation. “We remain vigilant to navigate through the last mile of disinflation as it is often the most difficult part of the journey. We firmly recognise that stable and low inflation will provide the necessary bedrock for sustainable economic growth,” the RBI governor said. Stable and low inflation will provide the necessary bedrock for sustainable economic growth, Das said. The governor of the country’s central bank said India has successfully navigated through multiple challenges and emerged as the fastest-growing large economy. “Prudent monetary and fiscal policies have paved the path for India’s success in sailing through these rough waters. The Reserve Bank projects the Indian economy to grow by 7.0 per cent during 2024-25, marking the fourth successive year of growth at or above 7 per cent,” he added. The RBI governor further said inflation has moderated from the highs of the summer of 2022. The retail inflation, which the RBI mainly factors in while arriving at its bi-monthly monetary policy, is inching towards its target of 4 per cent, with the January imprint at 5.1 per cent. He highlighted that recurring food price shocks and renewed flash points on the geo-political front pose challenges to the ongoing disinflation process. India’s coordinated policy response in the face of a series of adverse shocks can be a good template for the future, the governor noted. While monetary policy worked on anchoring inflation expectations and quelling demand-pull pressures, supply-side interventions by the government alleviated supply-side pressures and moderated cost-push inflation. Effective fiscal-monetary coordination was at the core of India’s success, he added. The governor said the global economy stands at a crossroads, and challenges remain in plenty, but new opportunities are also knocking at the door. “Together, the course we take from here will decide our destiny in times to come. We need policies that are attuned to the new realities of the global economy. In an uncertain world, central banks need to be proactive to better serve the objectives of price and financial stability,” he said. He noted that prospects of a soft landing have improved for the global economy, but there are multiple challenges with uncertainties looming on the horizon. With inputs from PTI