Central Banks
Excessive Hikes a Risk to India’s Growth, Jobs, Says Rate-Setter
- Full effect of rate hikes to be evident in a quarter or two
- Certain level of growth needed to absorb rising labor force
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While India isn’t at risk of a recession due to rising borrowing costs, excessive monetary tightening can expose the economy to below-potential growth that can cripple job creation and productivity, warns a rate-setter.
“What I am worried about is sub-par growth after two lost years,” Jayanth Rama Varma, a member of the Reserve Bank of India’s rate panel, said in an email interview, referring to the time lost to the pandemic.