Economic reforms, easing compliance helped India withstand global headwinds: FM Sitharaman (IANS Interview)

New Delhi, Sep 1 (SocialNews.XYZ) Finance Minister Nirmala Sitharaman has said India remains on a strong growth trajectory despite significant global economic challenges, citing the country’s 7.8 per cent GDP growth in Q1 FY27, robust manufacturing and services expansion and foreign exchange reserves of around $700 billion.

In an exclusive interview with IANS, FM Sitharaman also discussed the government’s reform measures, foreign investment, India’s engagement with the G20, bilateral economic ties and the steps being taken to position the country advantageously amid global uncertainties.

Here are the excerpts from the interview:

IANS: Can you tell us about the Q1 GDP number that has come out today? What are your first reactions?

FM Sitharaman: I am extremely pleased with the GDP numbers. Not because the numbers are good and whatever. It's more to say the hard work of the Indian citizens, even against extreme challenges, external challenges. And the challenges don't seem to die down at all. Despite these global challenges, if Indian economy is still growing at 7.8% in the first quarter of this financial year 2026-2027, it's heartening that the people's hard work is bearing fruit.

And this is not just one number, the GDP is growing in every sector. So manufacturing has grown at 9.2%, the financial sector and the professional services sector are growing at 12.1% and the foreign exchange reserve is at 700 billion US dollars. These are not ordinary numbers.

It's entirely because of the way in which people have risen to meet their personal aspirations as much as moving India towards a Viksit Bharat 2047. So I think all factors put together, despite the challenges that we are facing, we are able to clock this kind of a number. And this is only going to further strengthen this year's growth.

And I think if the first quarter started off like this, we will be able to sustain similar numbers in the other coming quarters as well. Here, if I may, I'd like to add, with a bit of a sense of disappointment, the way in which our opposition party projects India. It is one thing for an opposition party to constantly question the party in power and that is only right.

In democracy, you need a strong opposition party which speaks. But with this kind of growth numbers, consistently, it is such an odd thing that the leader of the opposition, Rahul Gandhi, constantly refers to Indian economy as a dead economy. It just shows poorly as to how he undermines the hard work of the Indian citizens.

None of us has a business to insult the Indian citizens who are working hard and are the prime triggers for this kind of a growth in the GDP number. So I would appeal to the opposition party to take cognizance of the hard work of our citizens and not speak disparagingly about them. In the last one and a half years, the world has seen a number of challenges.

IANS: What are the policies that you took which made India survive the global headwinds?

FM Sitharaman: I think together with the states, I will also credit the states, many of them who have come forward to make doing business a bit more easier. We, as you know, have reduced a lot of compliance burden on the citizens, whether it is by reforming the acts, by simplifying the regulations and also by removing archaic laws. So, over a thousand laws have been removed; 40,000 odd regulations have been simplified.

Constantly, we are engaging with the industry, with businesses, with trade. Also, the way in which bilateral trade agreements are being signed, we are now pushing ahead with investor protection agreement as well. So you are able to see several such steps.

The recent FCNR bank deposits which through the Reserve Bank, the Indian banks are able to obtain are all confidence giving measures. Very clearly deposits are coming, foreign deposits are coming and Indian citizens abroad are investing. But the number that we have reached well ahead of time shows the confidence that people have on Indian banking system and also on the Indian economy itself.

So, with these kinds of indicators, the trust that people have of Indian banking system and of the Indian macroeconomic indicators is clearly telling us the positive story and we would like to build on it.

IANS: On the Opposition's reaction to GDP numbers, what else would you like to tell us?

FM Sitharaman: I thought there were quite a few economists within the Congress party who form an economic advisory group like. I am sure they can't be denying the facts but for political purposes, if you want to talk ill of the Indian economy at a time when people are really doing well, there can be performance which can be improved in some other areas.

But that doesn't undermine the overall good story which is today revealed in number. Every quarter after quarter we are coming up with good numbers. To deny that fact and to speak the opposite of it just makes me feel that you know in Hindi you all say, it can't go on for too long.

IANS: You are here attending the G20 summit meetings for the finance ministers, World Bank, IMF are all calling India the fastest growing economy, White House today said India is a dynamic economy. How do you describe India in today's world?

FM Sitharaman: I will start with the fact that we have challenges. There is just no doubt. We are one of the large importers of crude and petroleum products. We are the large importers of various kinds of fertilizers, urea, ammonia, DAP, everything is imported. We have a certain production capacity within the country but despite all that we are importers.

And that is why in between we also thought of foreign exchange being spent on unnecessary travel. Nobody wants to stop any travel but the fact that we had to postpone some time. All these are very clear indication of a vibrant economy.

An economy which is receptive to the changes globally and adjusts itself in such a way that our growth does not get affected. So periodically Reserve Bank of India also comes up with its own assessment and they are all moving in the positive direction. Yes, the challenges are there and we will work as a government to position India in an advantageous way each time when there is a challenge.

IANS: Can you give us a sense of how India is playing a role in G20?

FM Sitharaman: On many aspects like the way the US Presidency has spoken about growth as a priority. It has spoken about the global imbalances as a concern.

The US has also very clearly placed high importance for financial literacy, which is a very personally dear point for the Secretary of Treasury Scott Bessent. So, in all these we are very much with the United States. And these are the points on which we also want fair open discussions.

Growth is a central point for the G20's financial track. Equally the global imbalances will have to be sorted out. And therefore, I appreciate the US Presidency in taking up these points, and we have been contributing to the discussions which happened today. I may also add here that I have had a very positive constructive bilateral discussion with Secretary Bessent today.

IANS: Can you give us a sense of other bilateral discussions?

FM Sitharaman: I have had bilaterals also with Poland, Qatar, Korea, Russia. All of them happened today and on a very positive note. Everyone has had facts about India in their hands, and they are looking forward for deepening their relationship with India.

IANS: In Chicago and also in New York you have travelled enough. You will have meetings with the corporate sector's leadership. What are you telling them?

FM Sitharaman: I commenced my trip from Canada. In Canada I have had a bilateral dialogue with the finance minister there. I have had a detailed discussion with pension funds in Canada.

Several of them I have met who are keen to come to India and invest. Along with me the NIAF chief and also the IFSCA chairman are travelling. They are talking with these pension funds and other private equity funds.

Also after that I came to Chicago and in Chicago I have had quite a few conversations with the funding agencies. I visited an innovation and entrepreneurial centre, the Polsky Centre, which was eye-opener in terms of the ways in which Indian universities are also engaging with them. Then I am in G20 and here I have had these bilateral meetings with several of these countries.

Many of them wanting to pursue the dialogue with them, like the Korean dialogue will be held this year itself. Qatari dialogue also will be done this year. There are quite a few activities that we have tied up for India and the bilateral engagement on economy and finance.

Tomorrow evening after I conclude the G20 I will be going to New York, wherein again I will be meeting with very many investors who are keen on coming over to India.

IANS: Your comments on the customs and banking reforms?

FM Sitharaman: Well, we take it as we go along. We have done quite a few things about the direct and indirect taxes. Customs, we have done some, we will have to do more. We will be taking those up. And also making sure that seamless import happens at the ports.

We are trying to bring in scanners and have high-risk importers alone go through them, and the rest of them can be cleared automatically. A lot of reforms in the customs area. And the banks, of course, we have appointed a high-level committee to look into banking for Viksit Bharat. That committee will also give its report.

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Source: IANS