Policy continuity, inclusion and innovation will be priority: Sanjay Malhotra RBI Governor

After taking charge on Wednesday, Reserve Bank of India (RBI) Governor Sanjay Malhotra stated that policy continuity, inclusion and innovation will be priority under his governorship.

Highlighting the legacy of the RBI, Malhotra stated that “It is a huge responsibility,” recognising the commendable work carried out by the central bank.

He stressed the importance of continuity in policies, saying, “stability in policy again, very, very important… even in my previous role we tried to give stability a continuity and policy whether it is taxation policy or fiscal policy or monetary policy, I think all businesses, all people, they do need this continuity and stability, rather than, you know, a day-to-day kind of a policies.”

Highlighting the need to adapt to a constantly evolving world, he acknowledged the challenges posed by geopolitical tensions, climate change, and economic uncertainties. He added that while we maintain continuity and stability, we cannot be stuck to it, recognising the challenges. He added,” We do maintain Continuity and stability. We cannot be stuck to it and we have to be alert and agile.”

Malhotra reaffirmed his commitment to financial inclusion, noting progress made but emphasizing the need for further efforts. “There is still more to be done so we will collaborate with all with our stakeholders… so that the benefits of financial inclusion reaches everyone.” He called for collaboration with regulators, governments, and other stakeholders to achieve this goal.

RBI Governor Malhotra pointed to India’s success with the Unified Payments Interface (UPI) and its growing global recognition. “How we can further use technology to reduce costs and make financial inclusion more accessible and pervasive and innovation will be a key (priority).”

He also emphasized balancing innovation with necessary safeguards, stating, “Innovation will be key.”

“We will, of course, have to be also conscious of the risks that it may entail and so putting in place, requisite, safe gards and guard rails without killing or without stopping innovation.”

Underscoring the value of consultation in policy-making, he pledged to continue the RBI’s practice of engaging with stakeholders. He added that the knowledge and expertise are not the monopoly of any one institution and consultation will remain a key pillar of our policymaking process.

Malhotra concluded with a promise to uphold the trust and values of the RBI, stating that whatever decisions are made will be in public interest, ensuring the trust of the people is strengthened.

Malhotra, a senior bureaucrat with extensive experience in economic and financial matters, brings a wealth of knowledge to his new role.

He succeeds Shaktikanta Das, who served as the Governor of the RBI since December 2018 and was instrumental in steering the Indian economy through various challenges, including the COVID-19 pandemic.

As the head of the RBI, Malhotra is expected to focus on maintaining inflation targets, boosting economic growth, and ensuring the financial sector’s resilience amidst global uncertainties.