Q1 2026 Honda Motor Co Ltd Earnings Call
Deputy Governor (DG) of Reserve Bank of India: Station, as the imports will get expensive?
As the imports will get expensive.
Governor of Reserve Bank of India: Until now, first thing is that in India, we are less dependent on the outside insofar as inflation is concerned. The other thing is that if at all there is an impact, there is also an impact on the growth, on the demand. That has a reverse impact. We mentioned this. We elaborated this in our monetary policy statement that we made, I think, a couple of months ago, where we highlighted this aspect, that it moves in both directions. As of now, we do not see a major impact of this unless we have retaliatory tariffs and so on and so forth, which I really do not foresee. I request our DG, if you would like to add something.
See if uh, uh,
If, uh, till now see, first thing is that in India.
Uh, we are, we are less dependent.
On, uh, the outside in so far as
Inflation is concerned.
and uh,
uh, the other thing is,
that if at all, there is
Uh, if at all, there is an impact.
There is also an impact on the growth.
On the demand.
And that has a reverse impact. We mentioned this. We elaborated on this.
In our, uh, monetary policy statement that we made, I think a couple of months, uh, ago where we highlighted this, uh, aspect that it moves in both directions.
As of now, we don't see a major impact.
of, uh, this unless you know, we have retaliatory tariffs and so on and so forth, which I
Deputy Governor (DG) of Reserve Bank of India: Sure. In addition to what Sans said, let me also remind that our inflation basket, nearly half of it consists of food, which does not get impacted directly by global developments. A significant part consists of non-tradables, which again does not get impacted by global developments. To that extent, the first-order direct impact of these evolving uncertainties on India's inflation is likely to be very, very limited.
Really do not foresee a request, or, uh, she would like to. Would you like to add something? Sure.
Um, in addition to what, uh, Sir said, let me also remind that, uh, inflation basket.
Uh, nearly half of it consists of food, which does not get impacted directly by global developments.
A significant part consists of non-tradables, which again do not get impacted by global developments.
So, to that extent of first-order direct impact of these evolving uncertainties.
On India's inflation, it is likely to be very, very limited.
Company Representative: Thank you, sir. Thank you, ma'am. I will ask Manojit Sahar from Business Standard.
Thank you, sir. Thank you, ma'am. Uh,
I'll ask Manojit Saha from Business Standard.
Journalist 1: Thank you, sir. What has stopped the MPC from, given that you have reduced the inflation forecast to substantially lower to 3.1%? What has stopped the MPC from a rate cut? Because you have indicated that you will be forward-looking, you will be proactive in interest rate decisions. What actually stopped MPC from a rate cut? Also, if you can throw some light on whether the monetary policy is effective on pushing loan growth because loan growth continues to be tepid despite a 100 basis point rate cut.
Thank you sir. Uh, uh, what is stopped the MPC from given that, you know, you have reduced the inflation forecasts to substantially lower to 3.1%. So what has stopped the MPC from a red cut because you have indicated that you will forward looking. You will be proactive in in interested decisions. So what I actually stopped a busy from a red card and if also, if you can throw some light on whether the the
The, my 3 policy is effective on pushing lending loan growth because loan growth continues to be tapped this.
By the 100th point, red cut.
Governor of Reserve Bank of India: The reasons for maintaining the policy rate are very, very clearly stated in our resolution, which also found a mention in my statements. Let me reiterate those. One, we did, first of all, a front-loaded rate cut, 100 basis points over a short period of four months, February to June. Transmission is happening. Uncertainties still continue. The situation is still evolving. Insofar as inflation is concerned, the projections are more or less, if you discount food, which is very volatile. I think I mentioned it somewhere earlier also that while our headline and food inflation over the last eight, nine years since FIT was introduced has been at 4.9%, the volatility in food prices is of the region of 3% on an average. The deviation, the absolute deviation is 3%. 5.9% plus minus 3% is the average. Whereas that in Q4 is much less, about 1.1% in absolute terms.
See, the reasons for maintaining the policy rate are very, very clearly stated in our resolution, which also found a mention in my statement. Let me.
uh uh, reiterate those
1 monetary, we did first of all, you know, a front-loaded rate card, 100 basis points over a period of a short period of.
Transmission is happening from February to June.
Uncertainties still continue. The situation is still.
Evolving.
Insofar as inflation is concerned.
Uh, the projections are more or less.
if you discount,
Food, which is very volatile.
Uh, I think I mentioned it somewhere earlier. Also, that while our headline and food inflation over the last 8 to 9 years since FIT was introduced, has been at 4.9%.
The volatility in food prices is in the region of 3% on average. The absolute deviation is 3% to 5.9%. Plus or minus 3% is the average.
Governor of Reserve Bank of India: So the changes that have happened are primarily because of food and not Q4. Q4 inflation, in fact, has only gone up slightly from the previous months. These are the reasons that we have continued to maintain the policy rate. We will keep watching incoming data and evolving outlook of our macroeconomic conditions. The MPC will accordingly take a view on a policy meeting to meeting, from meeting to meeting. Insofar as the impact of rates is concerned, I have given figures in the statement. It's about 71 basis points on the credit side, bank credit rates until June, within a period of four months. 71 basis points of which about 55 basis points is because of the change in the rate and not because of the change in the mix of the credit loans. That has happened.
Uh, whereas that in core is much less about 1.1% in absolute terms.
So, uh, the changes that have happened are primarily because of food.
and uh, not
Core, uh, inflation, core inflation. In fact, has...
Only gone up.
Slightly, uh, from the previous months.
Uh, so these are the reasons that, you know, we have continued to maintain the policy rate. We will keep watching incoming data and evolving.
Outlook of our macroeconomic conditions.
And the MPC will, you know, accordingly take if you want to.
Policy meeting to meeting, uh, from meeting to meeting.
Uh, the statement, it's about 71 basis points, uh, on the credit side, on the credit side Bank credit rates until June in within a period of 4 months.
71 basis points, of which about 55 basis points is due to the change in the rate and not because of the change in the mix.
Governor of Reserve Bank of India: Obviously, that will certainly help not only growth in credit, but also it will impact the real economy. As you are all aware, it happens with a lag this time, while the rates have, of course, come down significantly faster. The impact on the real economy will also start to happen. So there is no reason to believe that this will not have a growth-inducing impact. A growth-inducing impact.
Of, uh, uh, the credit loans. So that has happened.
And, uh, obviously, that will certainly, you know, help, uh, not only growth in credit, but also it will impact, uh, the real economy, as you are all aware. It happens with a lag this time.
While the rates have, of course, come down significantly faster.
Uh, the impact on the real economy will also uh uh start to happen. Uh and so there is no. So there is no reason to believe that this will not have a growth.
Inducing impact.
Uh,
a growth in inducing impact.
Company Representative: Thank you, sir. Next, we will have Mr. Mayush Shetty from Times of India.
Journalist 2: Thank you, sir. So, now that you explained the slowdown in credit demand, you said that there is some shift to other financial instruments. But the sectoral figures show that even housing, which typically goes up when rates go down, has slowed down. What do you think is the reason for this?
Thank you, sir. Uh, next we'll have Mr. Mahay from the Times of India.
Uh, the slowdown in demand, you said that there is some shift to other, uh, the financial instruments. But these sectoral, uh, ...
Figures show that even housing, which typically goes up when rates go down, has slowed down. What do you think is the reason for this?
Governor of Reserve Bank of India: I think it's important to, first of all, whenever one is looking, it's important to look at data on a regular basis, at a micro basis, at a month-to-month, quarter-to-quarter basis. To extract signals out of that, I think we should be hesitant in extracting signals out of that data. It is the long-term data that is more relevant to be making any insights out of it. On the other hand, I would also like to point out, these fluctuations will be there. There will be noise. As you are aware, there will be noise. We have to remove that noise. How do you remove that noise? It becomes very difficult if you are actually looking at data on a month-to-month, day-to-day basis. Having said that, housing credit, I think overall it's doing well. It's doing very well. It may have moderated somewhat, but these are to be expected.
I I think, uh,
It's important to, uh, first of all.
You know, whenever one is looking, it's important to look at data.
uh, in a
uh, uh, you know, on in, in, uh, data on a regular basis at a micro basis at a month-to-month quarter to quarter basis,
But to extract signals.
Out of that.
I think, uh, we should be hesitant in extracting signals out of that data.
So, it is the long-term data that is more relevant.
Uh, to be making.
Uh, you know, uh, to making, you know, any.
In state to, to get, you know, any insights out of it.
And, uh, on the other hand, I would also like to point out that these fluctuations will be there. There will be noise; as you are aware, there will be noise. So we have to remove that noise. How do you remove that noise? It becomes very difficult if you are actually looking at data on a month-to-month or day-to-day basis. Having said that, housing credit.
Governor of Reserve Bank of India: There will be some ups and downs. I think overall housing credit is 14% as we speak, which is very good, which is more than our average credit growth rate of about 10% that we are having this year. Some of the impact, as I mentioned, happens with a lag. We have reduced the rate. While the reduction in the rates has happened, it's translating into credit growth rate. People take their time too. It's a long-term investment. Housing is not a short-term investment. If you go to the market, you buy a consumer durable. It's not like that. It's a long-term investment. That also has an impact over here.
I think overall it's doing well, it's doing very well. It may have moderated some somewhat but, uh, these are, uh, these are to the expected. There will be, you know, some ups and downs. I think overall housing credit is, is, uh, 14%, uh, as as we speak, which is very, which is very good, which is more than our average, uh, credit growth rate of about 10% that we are having uh, this year.
And some of the impact, as I mentioned, happens with a lag. We have reduced the rate. So while the reduction in the rates has happened.
Uh, it translates into credit growth rate.
People take, you know, their time to... it's a long-term investment. Housing is not, you know, a short-term investment. You go to the market, you know, you buy a consumer durable. It's not like that. It's a long-term investment.
So that also has an impact to play over here.
Thank.
Company Representative: Thank you, sir. मैं जी बिजनेस से एकता सूरी को आग्रह करता हूं कि अपना प्रश्न पूछे.
You okay?
Ekta Suri: Good afternoon, sir. सबसे पहले बधाई, sir. Prime Minister Modi, PM Modi, RBI को धन्यवाद किया है कि आपने ग्राम पंचायतों में financial inclusion के लिए camp लगाया है, sir. उसके लिए congratulations. मेरा सवाल ये होने वाला है कि इस बार अगर हम banks के results देखें तो इसमें हमें NPA बढ़ता हुआ दिख रहा है और अगर हम MFI सेगमेंट की बात करें तो वो पिछली बार भी आपने concern raise किया था कि उसमें NPA बढ़ रहे हैं. उसको लेकर क्या हम किसी तरह की rules, नियम सख्त होते हुए देख सकते हैं, खासकर के तब जब जो NBFCs हैं, priority सेक्टर में ये पैसा उठाती हैं, लेकिन money lender के जैसे rates बढ़ चुके हैं इनके. तो उसको curb करने के लिए क्या हम rules सख्त होते हुए देख सकते हैं?
Good afternoon sir, sir.
Mfi segment.
Ekta Suri: दूसरा ये, sir, कि अगर mule hunter की बात करें तो बहुत से banks ने implement कर दिया है. तो अब आम लोगों का पैसा कितना जल्दी वापस आ सकता है, fraud से गया हुआ पैसा, और कितना सुरक्षित है अब पैसा उनका?
Deputy Governor (DG) of Reserve Bank of India: आपने एक तो कई सारे प्रश्न एक साथ पूछ लिए हैं। तो सबसे पहले आपको जो है धन्यवाद। आपने जो बधाई दी है financial inclusion के लिए, वो हमारे लिए बहुत सबसे ज्यादा अहम है, महत्वपूर्ण है और इसका जिक्र हमने अपने monetary policy statement में भी किया है। तो हम चाहेंगे आप सबके माध्यम से कि ये जो हमारा प्रयास है, उस प्रयास को आप सभी अपने श्रोताओं और अपने viewers तक आप पहुंचाएं और इसको आप publicize करें ताकि लोग जो हैं इसका अधिक से अधिक लाभ उठा सकें। जो आपने बात कही कि कुछ NPA बढ़े हैं, मेरी ऐसी जानकारी नहीं है। कुल मिलाकर के, जैसा कि मैंने अपने वक्तव्य में आज जो हमारा monetary policy का वक्तव्य था, उसमें भी मैंने निवेदन किया कि कुल मिलाकर जो हमारे net NPA हैं, जो हमारे gross NPA हैं, पूरे banking क्षेत्र को जब हम देखते हैं, 2.2% gross, 0.5% से लेकर के 0.6% तक net NPA है, तो वो काफी संतोषजनक है और उसमें वृद्धि नहीं हुई है। यह संभव है कि कुछ एक क्षेत्रों में, जैसा कि आपने बताया, MFI में, unsecured loans में, वहां पर निश्चित रूप से कुछ NPA बीच में बढ़े थे, जिसकी वजह से हमने क्रेडिट जो weights हैं, उनके ऊपर में बढ़ाए थे। और उसके बाद में हमने यह भी देखा कि जो एक बहुत अधिक दर से वृद्धि हो रही थी, क्रेडिट की ऋणों की इन क्षेत्रों में, MFI और unsecured personal loans में, उसमें उसके बाद में कमी भी आई है। तो कुल मिलाकर के, लेकिन इसमें कोई चिंता का हमारे लिए कोई विषय नहीं है। और हमारा यह बिल्कुल हर समय यह प्रयास रहता है कि especially जो जैसा हमने कहा, bottom of pyramid, microfinance, जो लोग ले रहे हैं, छोटे-छोटे, दस हजार, बीस हजार, पांच, पचास हजार रुपए तक के जो loan ले रहे हैं, और वो हमारे पूरे जो हमारा पूरे जो stakeholders हैं, उसमें एक बहुत अहम और महत्वपूर्ण अंग है। लगभग आठ करोड़ लोग MFIs, हालांकि amount संख्या में केवल तीन लाख और पचहत्तर हजार करोड़, लगभग चार लाख करोड़ रुपए के करीब ऋण हमने उनको दिया है। कुल मिलाकर एक सौ अस्सी लाख करोड़ में से वो प्रतिशत में दो प्रतिशत ही लगता है, लेकिन लगभग आठ करोड़ लोग हैं, क्योंकि हमारे जो total loan accounts हैं, या loan accounts आठ करोड़ हैं, व्यक्ति हो सकता है कम हो, क्योंकि एक व्यक्ति कई बार जो है दो-दो loan भी ले लेता है। तो यह हमारे लिए एक बहुत महत्वपूर्ण और बहुत important श्रेणी है, और इसके लिए जो भी हमारे को करना है ताकि और इनका financial inclusion हो, जैसे camps भी हम लगा रहे हैं, वो उसके ऊपर में हम कार्य करते रहेंगे। तीसरा आपका question, प्रश्न है mule hunter.
Okay.
Do you have Financial inclusion?
Maybe.
Crossing.
uh,
unsecured loans, secured personal loans.
Bottom of pyramid, micro Finance.
For.
Total loan accounts. Loan accounts are important.
Deputy Governor (DG) of Reserve Bank of India: Mule hunter से निश्चित रूप से सबसे पहले मैं यह कहना चाहूंगा कि पिछले वर्ष जो हमने देखा, जो financial frauds हुए हैं, वो अगर आप कुल amount में देखते हैं, तो उसमें लगभग जितने हमारे वर्ष तईस चौबीस में हुए थे, उतने ही हुए हैं। कोई अधिक बहुत ज्यादा वृद्धि नहीं हुई है। तो जब आप प्रति transaction अगर उसको देखेंगे, तो उसमें कमी आई है। तो यह एक हमारे लिए संतोष का विषय है। दूसरा, mule hunter का हमारा जो कार्यक्रम है, वह काफी आगे बढ़ रहा है। पंद्रह banks इसके अंदर हमारे लिए सम्मिलित हो गए हैं, और निश्चित रूप से इससे भी इस दिशा में हमारे को लाभ मिलेगा।
Financial inclusion.
Company Representative: बहुत धन्यवाद, sir. Now I will ask Vishwanath Nair from NDDB Profit to ask his question.
Journalist 2: Thank you, sir. Governor, the conversation or the uncertainty, so-called uncertainty, after the tariff policy measures that have been announced from the U.S., they are still continuing. The President there consistently makes statements about specific tariffs to India. A lot of economists have pointed out that monetary policy may not be the appropriate tool to support Indian businesses in such a scenario. Is there anything that the RBI can do or is prepared to do on top of, say, category?
To.
Um, Governor the conversation or the uncertainty so-called uncertainty. After the policy tariff policy measures that have been announced from the US, they still are continuing, you know? Uh the president there consistently make statements about uh specific tariffs to India.
A lot of economists have pointed out that monetary policy may not be the appropriate tool to support Indian businesses in such a scenario. Is there anything that the RBI can do, or is prepared to do, on top of, say, cutting rates?
Governor of Reserve Bank of India: On top of what are you hinting? We have taken a number of measures to support growth. It is not only on the monetary policy liquidity side, even on the prudential regulation side, we have taken measures. Even on the FEMA side, I think we have taken, we have a draft now which will be put up. So as to ease doing businesses, to ease doing international trade. We will continue to do whatever is required to be done in such a scenario. Of course, trade negotiations are still continuing. We are hopeful that we will have an amicable solution.
On.
Uh, uh, the monetary policy liquidity side, when, you know, on the potential regulation side, we have taken measures.
Even, you know, on the famous side. I think, you know, we have taken, uh, we have a draft now, which will be put up so as to ease, uh, doing business to ease, you know, doing, uh, international trade. And, uh, we will continue, you know, to do what is required to be done. Uh, in such a scenario, of course, trade regulations are still continuing. We are hopeful, uh, that we will have, you know, an amicable solution.
Company Representative: Thank you, sir. Next, we have Hamsini from Money Control.
Thank you, sir. Next, we have Hamsini from Money Control.
Journalist 2: Hi. Governor, when we speak to banks, one of the largest fears that they have is with respect to growth. They are also seeing a large part of their deposits moving out into equity and equity-related products, or rather corporatization of deposits, as bankers call it, is a trend that they are increasingly seeing. In this context, how much room do you further envisage for transmission of rates? We have already seen a healthy transmission as far as lending is concerned. Numbers are in the ballpark of 71 on the lending side, and on deposits, it is 87. We have had 100 bps cut from February. Do you see further room for rates happening for banks? Considering that their balance sheets will also remain healthy, should they transmit more money? Or should we look out for a longer pause in rate action, sir?
Hi, uh, hi. Uh, Governor. When we speak to Banks 1 of the largest fears that they have is with respect to growth and they're also seeing a large part of their deposits, moving out into equity and Equity related products, um, or rather uh, corporatization of deposits as Bankers. Call it is a trend that they're increasingly seeing in this context. How much room do you further envisage for transmission of rates because, uh, we've already seen a healthy transmission as far as uh, uh, lending is concerned, numbers are in the ballpark of 71 on the lending side and on deposits, it's 87. Uh, we've had a 100 bits cut from February, uh,
Journalist 2: Which of the two is more likely to play out?
Governor of Reserve Bank of India: No, that is for the monitor. I think I answered your question earlier. We will continue to look at the incoming data. The monetary policy committee meets every two months. We will consider all possible scenarios and bases that we will take a decision. It will not be right on my part to preempt. Not only preempt, I mean, I really do not have as of now any answers. We will see. Whatever was to be done today has been done. Let's wait for another two months and see how the economy actually shapes up, how the monetary policy transmission is actually happening, how the real economy is responding to all these things. Then we will again take up. As we have mentioned, we will not be found wanting in whatever is required to provide the right balance of price stability and economic growth for the development of our country.
Or do you see further room for rates uh, happening for banks? Uh, considering that their balance sheets will also remain healthy. Should they transmit more money or do? Should we look out for a longer? Pause in uh, rate action, sir, which, which of the 2 is more likely to play out.
No. See, that is for the monitor. I think I answered your question earlier. Uh, we will continue to look at the incoming data, and the Monetary Policy Committee meets every two months. We will, uh, consider all possible, uh, scenarios and bases that, uh, we will take, uh, our decision. It will not be right on my part to preempt.
Not only preempt, I mean I really do not have, you know, as of now any answers we will, we will see whatever was to be done. Today has been done. So let's wait for another 2 months and see how the economy actually shapes up. How the monetary policy transmission is actually happening. How the real economy is responding uh to all these things and then uh we will again you know take up as we have mentioned we will not be found wanting in whatever is required uh to provide the right balance of price, stability, and economic growth.
For, uh, the development of our country.
Company Representative: Thank you, sir. Now I will ask Mr. Ashish Gache from PTI.
Thank you, sir.
Journalist 1: Thank you so much, sir. Sir, with your statement today, and especially by making the point that food inflation is very volatile, are you probably, and your projections also, are you sort of probably preparing for a longer pause on the rates front from here on, sir?
Now, I'll ask Mr. Ashish Aashi from PTI.
Governor of Reserve Bank of India: Same question. Asked in a different way. I do not have anything more to add. Sorry.
Uh, thank you so much sir, uh, for the with your statement today and especially uh uh, by making the point that food food inflation is very volatile. Uh, are you probably and and your projections also? So are you sort of probably preparing for the longer pause uh on the rates front uh from here also
Company Representative: Thank you, sir. Next, we will have Mr. Anup Rai from Bloomberg.
Same question as to in a different way so I don't have anything more to add. Sorry.
Thank you, sir. Uh, next we'll have Mr. Ano from Zoom Bug.
Journalist 2: If India has to stop buying Russian oil or has to revert back to that 1% of the total oil purchase that we had with Russia, what could be the impact on inflation? Has the RBI done any study? Or do you have any assessment on preliminary?
Or has to revert back to that 1% of the total oil purchase that we had with Russia. What could be the impact on inflation? Has the RBI done any study? Or do you have any assessment on that?
Governor of Reserve Bank of India: How the inflation will pan out, I think some of it the DG also mentioned. Of course, crude is an important element in determining our inflation. At the same time, let's keep two things in mind. It's not only Russian oil. Oil earlier, you know, I mean, it's not only Russian oil that we are taking. We are taking oil from many other countries. If the mix changes, what is its impact on prices? What is the global commodity prices of crude? It will depend on all that. The other thing it will depend on is how much of its impact, downwards or upwards, is actually taken by the government in the form of excise duties and other tariffs.
Brilliant idea. See how the inflation will pan out. I think some of it. The DG also mentioned, of course, crude is an important, uh, element in, uh, in determining our, uh, inflation. But at the same time, let's keep, you know, 2 things in mind, it's not only Russian oil, uh, oil earlier. You know, I mean, and it's not only Russian oil that we are taking, we are taking oil from any other countries to make if the mix changes, what is its impact on price?
Is what is the global commodity prices of crude? It will depend on all that.
And the other thing it will depend on is how much of its impact.
Governor of Reserve Bank of India: We don't see any major impact as of now because of this on inflation because I think the government over there will take an appropriate decision on the fiscal side in case there is any shock over there.
Downwards or upwards is actually, you know, taken by the government in the form of excise duties and other tariffs. So, um, we don't see any major impact as of now.
On the fiscal side, in case there is any shock over there.
Company Representative: Thank you, sir. Anurag Shah from ET Now Swadesh.
Thank you, sir. Uh, Anurak Sha from ET Now, Sesh.
Journalist 1: नमस्ते, sir.
Company Representative: Sir, जिस तरह का आपने आज अपनी policy में तीन consumer-centric ऐलान किए और उन तीन consumer-centric ऐलान के अंदर से जो करोड़ों जनधन खाते हैं, उनकी re-kyc की जाएगी और उनको insurance के product और pension के product भी offer किए जाएंगे। तो sir, इसमें मैं आपसे ये समझना चाहता था, क्या जो एक mule account है, एक बहुत बड़ी समस्या बन गई, जिसपे per transaction में तो आपने बताया कमी आई है, लेकिन अभी एक और UP पुलिस के द्वारा एक बहुत बड़ा मामला पर्दाफाश किया गया है, पिछले महीने भी किया गया था, बहुत बड़े पैमाने पे कि जो accounts हैं, कई सारी बड़ी बैंकें भी हैं, जो मृत लोग, कुछ महीने पहले death हो चुकी है, लेकिन बड़ी बैंकों के द्वारा भी उनके kyc किए जा रहे हैं, उनकी account open किए जा रहे हैं, transaction हो रहे हैं और ये बड़े पैमाने पे चल रहा है। तो उसको देखते हुए भी, sir, ये re-kyc जो है, बड़े पैमाने पे की जाएगी। और sir, एक आपने उसी संदर्भ में जो कहा कि need analysis बहुत जरूरी है बैंकों के जरिए जो product बेचे जाते हैं। तो sir, need analysis को लेकर क्या कोई framework लाया जाएगा और किस तरह से need analysis होगा?
Namaste sir, sir.
Need a analysis framework.
Deputy Governor (DG) of Reserve Bank of India: आपने निश्चित रूप से बहुत महत्वपूर्ण अहम सवाल आपने उठाए हैं और इसके लिए हर समय जो रिज़र्व बैंक है, बैंक्स हैं, वो जागरूक हो रहे हैं, चाहे वो mule account के बारे में आपने कहा, re-kyc के बारे में आपने कहा, और आपने miss selling के बारे में आपने कहा. तो इसके लिए कई सारे कदम हमने उठाए हैं. mule account का एक प्रोजेक्ट हम already चला रहे हैं. वो शीघ्र ही हम उसको लागू करेंगे, उससे इसमें मदद मिलेगी, जैसा कि मैंने पूर्व में बताया. और miss selling के लिए भी हम समय-समय के ऊपर में हमने अपने banks को, regulated entities को सावधान किया है. मेरा और इसमें और निश्चित रूप से इसमें सुधार की गुंजाइश है.
Deputy Governor (DG) of Reserve Bank of India: मैं ये नहीं कहूंगा कि सुधार की गुंजाइश नहीं है, लेकिन काफी सुधार पहले से इसके ऊपर में हुआ है और हम और आगे भी इसमें और अधिक कदम लेकर के इसमें और सुधार करने का प्रयास करेंगे.
Company Representative: Sir, credit link insurance से अगर दुनिया भर में हम देखें तो regulator है, वहाँ पे credit link insurance कहीं पर भी नहीं है. केवल भारत के अंदर ही credit link insurance को ज्यादा प्रोत्साहन दिया जाता है.
Deputy Governor (DG) of Reserve Bank of India: नहीं, मेरे हिसाब से ऐसा नहीं है कि केवल भारत में ही। आप शायद ये कह रहे हैं कि bank assurance, आपका शायद कहना कि ये bank assurance, banks insurance products भी बेचे केवल भारत में है। ये ऐसा सही नहीं है। कई अन्य देश हैं जहाँ पे banks insurance products बेच रहे हैं, अन्य products भी बेच रहे हैं। और इसमें देखिए, इसमें लाभ ये है कि एक network जो हमने already पूर्व में बनाया हुआ है, यदि वही network के through एक से ज्यादा products यदि बेचे जाते हैं, तो जो costs हैं, economies of scale आती हैं, costs जो हैं, वो कम होती हैं। और जो financial inclusion है, उसको मदद मिलती है, especially जो ग्रामीण इलाके हैं, वहाँ पे। तो उसी को ध्यान में रखते हुए हमने ये यहाँ पे allow किया और ऐसे बहुत सारे अन्य देश हैं जहाँ पे इसको allow, जिसमें जहाँ पे ये चालू है, जहाँ पे ये allowed है। हमारा प्रयास यही रहना चाहिए कि miss selling न हो, need analysis हो, जैसा कि आपने कहा, और इसका सही प्रयोग, सही लोगों को ये products बेचे जाएं। तो हमारा ध्यान उस तरफ रहना चाहिए, न ये कि हम इसको totally ban कर दें या बंद कर दें।
Insurance.
Assurance banks, insurance products. Insurance products.
Financial inclusion.
Need analysis.
Or.
Products.
Totally.
Company Representative: Thank you, sir. Next will be Sangita Mehta from Economic Times.
Thank you, sir. Uh, next will be Sita Mata from the Economic Times.
Journalist 2: Thank you, sir. Sir, you have spoken about transmission on the deposit side, almost 87 basis points, and it is still unfolding. What I wanted to understand from you is that deposits in financial savings have also been likely to fall if interest rates come down, share of deposits. In that sense, do you—there is also the perception that people would move to a riskier asset, savings would move to high yielding assets like mutuals. Are you seeing this impacting banks' deposit growth and also banks' ability to fund corporates?
Thank you.
Sir, uh, you've spoken about, uh, uh,
Transmission in, on the deposit side, almost 80, uh, 87 basis points, and it's still unfolding. Uh, what I wanted to understand from you is that, uh, uh, deposits in financial savings have also, uh,
is likely to fall if interest rates come down,
Uh, share of deposits.
Uh, so in that sense, do you, uh, there is also the perception that people would move to a riskier, uh, as such savings would move to higher-yielding assets like.
Uh, this, uh, is affecting, uh, impacting banks, uh, deposit growth and also banks' ability to, uh,
fund corporates.
Governor of Reserve Bank of India: Let me take your second question first. The ability of the banks to fund corporates, I don't think that is getting in any way impeded because of this. The banks have sufficient funds in order to meet the needs of the economy, be it corporates, be it households, be it the government sector. That is certainly not impeded. Yes, to your first question as to whether there is a shift, there is certainly a shift from banking to equity, from debt to equity. I think that is, on the whole, a healthy trend for any economy. As it grows, there should be a good mix. I think we are moving towards that. We should not be unduly concerned about that.
Uh, so let me take your second question first. The ability of the banks to fund corporates, I don't think that is getting in any way impeded because of this, uh,
Have sufficient funds in order to meet the needs of the economy. Be it corporates be. It households be. It the government sector. Uh, so that is certainly not, uh, impeded.
Yes, uh, to your first question as to whether there is a shift, there is certainly a shift from banking to equity, from debt to equity.
Uh, I think that is on the whole. It's a healthy trend for, uh, any economy. As it grows, there should be a good mix, and I think we are moving towards that. We should not be unduly concerned about that.
Company Representative: Thank you, sir. Next, I will have Aryan from Informis Media.
Thank you, Sir. Uh, next I'll have Aryan from Information Media.
Journalist 1: Sir, thank you so much for the question. First, just a clarification. Do the FY27 CPI estimates take into account any changes in the weightage of the CPI basket, which is expected in February next year?
Governor of Reserve Bank of India: No.
Uh, sir, thank you so much for the question. Uh, first, just for clarification, do the 27 CPI estimates take into account any changes in the weightage of the CPI basket, which is expected in February next year?
Journalist 1: Coming to the question, inflation projections seem to show that the current food inflation trajectory will not last in the sense that core inflation will overpower it in the coming quarters. Can the continued good monsoon and supply side measures not keep CPI nearer the target of around 4% in the next year as well?
No. Okay, so then coming to the question, inflation projections seem to show that the current food inflation trajectory will not last, in the sense that core inflation will overpower it in the coming quarters.
Can the continued good monsoon and supply-side measures not keep CPI nearer the target of around 4% in the next year as well?
Governor of Reserve Bank of India: We have given our projections. But when we give this projection, there are risks on both sides.
See, we have given our projections.
Journalist 1: Okay.
Governor of Reserve Bank of India: Can it not be downwards? Of course, it can be downwards. It can be upwards. That is the short answer to your question. These are projections. These are very difficult things to do. We had projected earlier, and not only we, some of the professional forecasters too, you are aware, we had all projected a 3.7%. We had projected 3.7%. They had, in fact, projected a 3.8% average growth inflation rate for this year. We have all been surprised this time. These are projections. These are difficult things to do. I would certainly not venture to say that it cannot be lower than this.
Uh, but when we give this projection, there are risks, you know, on both sides. Okay.
So, can it not be downwards? Of course, it can be downwards, it can be upwards.
That's the short answer to your question.
These are projections; these are very difficult things to do. Uh, we had projected earlier.
And not only we, some of the professional forecasters too. You are aware. We all projected a 3.7%. I mean, we had projected 3.7%; they had, in fact, projected a 3.8% average growth rate, uh, inflation rate for this year, and we have all been surprised, um, this time. So, uh, these are projections. These are difficult things to do. I would certainly not.
uh, venture to say that it cannot
it cannot be lower than this.
Journalist 1: Just to follow up on this, would you then give greater primacy to core CPI going ahead, considering the minutes of the last meeting also mentioned it, and you have also mentioned it in your statement?
Governor of Reserve Bank of India: Both are important. Core as well as headline, both are important. What weightage is to be given, at what point of time, and the outlook, again, you know, that is something which the MPC looks at it from meeting to meeting. I did say, and we are on record to say this, that there is higher volatility in food prices. They can be transient. You have to see these things and sometimes look through if you feel that some of the inflation is because of transient reasons.
So, just to follow up on this, would you then give greater privacy to core CPI going ahead, considering the minutes of the last meeting mentioned it, and you've also mentioned it in your statement?
Both are important, uh, core as well as...
Headline: Both are important. What weightage is to be given at what point in time and the outlook. Uh, again, you know, that is something which the MPC looks at from meeting to meeting, and uh, I did say, you know, and we are on record to say this: that uh, there is higher volatility in food prices; they can be transient. So you have to see these things and sometimes, you know, look through if you feel that uh, some of the inflation is because.
Of transient tree, transient reasons.
Company Representative: Thank you, sir. Next, I will have Swathi Bhat from Reuters.
Thank you, sir. Uh, next, I'll have Swati from Reuters.
Journalist 2: Thank you, sir. Sir, just sticking to the trade talks, it seems like on the face of it, the diplomatic relations between India and the U.S. have also sought to some extent. You would be more privy to what's happening there. But sir, I just wanted to understand, would it impact the foreign portfolio inflows and foreign investments into India because of the way things stand? Subsequently, what would the impact on the rupee be? Are you concerned and looking at it internally at RBI? Thank you.
Uh, thank you, sir. Uh, so just sticking to the trade talks, uh, you know, it seems like, on the face of it, uh, the diplomatic relations between India and the U.S. have also started to some extent. Uh, you would be more privy to what's happening there. But I just wanted to...
Talk back to the foreign portfolio inflows and foreign investments into India because of the way things stand. Subsequently, what would be the impact on the rupee? Are you concerned and looking at it internally at the RBI? Thank you.
Governor of Reserve Bank of India: Foreign flows, inflows, outflows depend on so many things, both current account and capital account. It is very early, actually, to say. As I mentioned earlier, we are quite confident that our reserves are, we are having 11 months of merchandise imports reserves. We are very confident of meeting whatever needs are there from the external sector.
See foreign flows. In flows and outflows depend on many factors, both in the current account and the capital account. It's very early actually, to say. But as I mentioned earlier, we are quite confident that our reserves are...
Uh, reserves. And so we are very confident of meeting whatever needs are there from the external sector.
Company Representative: Thank you, sir. Next, we will have Mishra Ankur from ET Now.
Thank you, sir. Uh, next we’ll have Mr. Ankur from Eating It Now.
Journalist 1: Thank you, Paniji, for giving a chance. Good afternoon, Governor. You have kept intact the projections for FY26 at 6.5% as far as GDP is concerned. In your statement, point number 10, you have mentioned that growth remains robust in line with your projections, but below your aspirations. What is the aspiration you would want to have first? Last time when we had interactions, you did give assurance on one particular banking name and whereby now the MDN CEO is also appointed. I want to understand from you, any kind of remedial action is still remaining from the bank side? Because on savings front, yes, final order is still remaining. Is RBI also looking into it? The responses which have been given or the action which has been taken by the bank is sufficient?
Thank you for giving a chance uh good afternoon. Governor uh you have kept intact the projection for a wide 26 at 6.5% as far as GDP is concerned uh in your statement Point number 10. You have mentioned that growth remains robust.
Governor of Reserve Bank of India: We do not take specific entity-related, bank-related questions. I will avoid that. Your first question related to what is the aspirational growth rate, it is certainly more than 6.5%. In the past, we have done, I think, 7.8% on an average. We have done that. Certainly, we should aspire for higher growth rates than 6.5%.
In line with your projects but below your aspirations. Uh, what is the aspiration? Uh, you would want to have first. And another thing, last time when we had interactions, you did give assurance on one particular banking, uh, uh, name and whereby. Now the MDN CEO is also appointed. I want to understand from you now, uh, any kind of remedial action is still remaining from the bank side because on SEB front. Yes, final order is still remaining, but is RBI also looking into it? And, uh, the responses which have been given or the action which has been taken by the bank is sufficient.
See, we don't take specific.
Entity related Bank related, uh, questions.
Uh, so I will avoid that.
But, uh, your first question related to what is the aspirational growth rate; it is certainly, you know, more than 6.5 percent.
And, uh, in the past, we have done.
I think 7.8% on average.
We have done that.
Company Representative: Thank you.
so certainly, you know, we should Aspire uh for higher growth rates, 106.5%
Governor of Reserve Bank of India: Thank you, sir.
Thank you.
Company Representative: Next, we'll have Lal Tendu Mishra from The Hindu.
Journalist 1: Good afternoon, Governor. U.S. President Donald Trump has said that the Indian economy is dead. What is your reaction?
Thank you, sir. Next, we'll have Lendu Mishra from The Hindu for that section.
Uh, good afternoon, Governor, uh, U.S. President. Donald Trump has said that the Indian economy is dead.
Governor of Reserve Bank of India: No, I am not the right person to react to the president. But yes, you are all aware we have a very robust growth rate, 6.5%. In fact, as per IMF, 6.4% and 3% growth rate of the world, when they look at that, we are contributing about 18%, which is more than U.S., where the contribution is expected to be much less at about, I think, 11% or something. We are doing very well, and we will continue to further improve.
What is your reaction to that, sir?
No, no. I'm not the right person to react.
To the President. But yes, I mean you are all aware that we have a very robust growth rate of 6.5%. In fact, as per the IMF, it is 6.4%, in comparison to the world growth rate of 3%. When they look at that, we are contributing about 18%, which is more than the U.S.
Where the contribution is expected to be much less at about, I think 11% or something. So, uh, we are doing very well and, uh, uh, we will continue, uh, continue to further improve.
Company Representative: Thank you, sir. From the right-hand side here, Mr. Mahesh Nair from FE.
Journalist 1: Good afternoon, sir. Thank you for the opportunity. Just wanted to know, is today India ready to bite the bullet on capital convertibility, full capital convertibility? I would want your view on that because having a very strong economy, do you think we can forego a temporary pain and look into fully capsule conversion?
Thank you, sir. Uh, from the right hand side here, Mr. Mahesh NY from FP.
Good afternoon, sir. Thank you for the opportunity.
Just wanted to know, is today India ready to bite the bullet on?
Governor of Reserve Bank of India: There is no proposal for any changes as of now.
Federal convertibility, full capacity. I would want your view on that. Because having a very strong economy, do you think we can forego a temporary pain and look into fully capitalizing on combat? There is no proposal for any changes as of now.
Company Representative: Thank you, sir. Ms. Gopika from The Mint.
Thank you, sir. Uh, Miss Gopika from the Mint.
Journalist 2: Good afternoon, Governor. This was regarding the currency depreciation we have seen over the last one month. Dollar rupee has risen by around 2.8%. Is that limiting RBI's ability to cut rates? Secondly, taking Ankur's question forward, in similar circumstances, we have seen RBI suspending the board, taking over, appointing RBI nominee directors on the boards of such banks where there is a fraud or instances of fraud which have happened. Is RBI planning to take any action against the promoter or the board in this particular case, considering RBI has also allowed the promoter to increase the stake and also appoint two nominee directors on the board?
Good afternoon, Governor. This was regarding the currency depreciation we've seen over the last month.
The rupee has depreciated by around 2.8%, which is limiting the RBI's ability to cut rates. Secondly, taking Uncle's question forward in similar circumstances, we've seen the RBI...
Governor of Reserve Bank of India: We don't take, as I mentioned earlier, we don't take any entity-specific questions. I will skip that. Rupee depreciation, again, there will be some volatility. We are living in very uncertain times, as you are aware. Some of the volatility is expected. The volatility is there not only in our currency, but even in currencies of other countries, including the U.S. The U.S. currency has seen appreciation and then depreciation, both side movement of about 10%. In that context, our movement is much less. How does it impact our monetary policy? As I said, it is a mix of so many things, but more so the domestic growth and inflation dynamics.
Um, suspending the boards, taking over appointing RBI nominee directors on the boards of, uh, such banks where there is a fraud or instances of fraud which have happened. Uh, is RBI planning to take any action against the promoter or the board in this particular case, considering RBI has also allowed the promoter to increase the stake and also appoint two nominee directors on the board.
So you don't take, as I mentioned earlier, we don't take any...
Entities specific questions so I will skip that.
Uh, rupee depreciation, again, you know, there will be some volatility. We are living in very uncertain times.
As you are aware.
And so, some of the volatility is expected. The volatility is there not only in our currency but even in currencies of other countries, including the U.S. The U.S.
currency has, she has seen
Appreciation and then depreciation. Both sides moved about 10%.
So in that context, our movement is much less.
How does it impact our monetary policy? As I said, you know, it is a mix of so many things.
But more so, you know, the domestic growth and inflation dynamics.
Company Representative: Thank you, sir. From the same side, Mr. Piyush from Hindu Business Line.
Thank you, sir, from the same site. Mr. Push from Hindu Business Line.
Journalist 2: Yeah. Good afternoon, Governor, DGs. Thanks, Paniji. Sir, upper layer NBFCs are supposed to get listed by next month. Tata Sons has filed for a deregistration of their NBFC CIC license. What is the update on that? Will you give them an extension or will you approve their request? One. Second, Ravi Shankar, sir, some of the banks have actually started applying charges on UPI to payment aggregators and merchants of some categories. Governor, sir, I had in his earlier public remarks mentioned that UPI cannot be free forever. So from a regulatory perspective, do you allow banks to, because this is no MDR, so they are somehow wanting to monetize this particular thing? Any views in this regard? Thank you.
Uh, good afternoon. Uh, good afternoon, Governor DG's. Uh, thanks for calling, G sir. Uh,
Upper layer, nbfcs are supposed to get listed by next month. Uh, tatas ones have filed for a registration of the era. NBC, I see what?
Governor of Reserve Bank of India: Let me come in first. Then I will pass the floor to DG Ravi Shankar. You are aware, entity-specific questions we avoid, right? You know, saying that, I said that it cannot remain free forever, I never said that. I am sorry. I want to clarify. I never said that it can remain free forever. The question was, I think, to the effect that whether do you see that the MDR, et cetera, will be charged on consumers? I said over there that there are costs. What is important, I said, is that there are costs. These costs have to be paid by someone. Who pays is important, but not so important than someone footing the bill. It is important for us, for the sustainability, that whether collectively or individually, someone pays for it. I never said that it cannot remain free forever.
Uh is the update on that. Will you give them an extension or uh will you approve their request 1. Second uh uh uh some of the banks have actually started applying charges on UPI to payment aggregators and Merchants of some categories. Uh Governors are adding this uh earlier public remarks mentioned that the UPI can't be free forever. So from a regulatory perspective do you allow Banks to? Because this is no MDR. So they are somehow, you know, wanting to monetize. Uh, this particular thing. Uh, any views in this regard? Thank you. Let me, let me come in first and then I'll pass the floor, you know, to DJI Robin shanka
uh,
You are aware entity-specific questions we avoid, right?
But, you know, saying that I said that it cannot remain free forever. I never said that. I'm sorry I want to clarify. I never said that. It can remain free forever. The question was
I think to the effect that whether do you see that the MDR, etc., will be charged on consumers.
and I said, over there that
There are costs.
What is important? I said that there are costs.
And these costs have to be paid by someone.
Who pays?
Is.
It's important, but not so important. Then someone is putting the bill.
And so it is important for us for the sustainability that whether collectively or individually someone pays for it. So I never
Governor of Reserve Bank of India: My sense is that it is not free even now. Someone is paying for it. The government is subsidizing it. Somewhere, the costs are being paid. The question really is, who pays for it? That is the other question that can, but I never said that the users will have to pay. I think government, I did mention that the government policy has actually helped in expanding the use of UPI. I gave some number, 31 crore to 61 crore per day UPI transactions over the last two months. I will leave it at that. Then I will request DG Ravi Shankar on if you have to add anything over there.
Uh, said that, uh, it cannot remain free forever. My senses that it is not free; even now someone is paying for it. The government is subsidizing it, but somewhere the costs are being paid. The question, really, is who pays?
Space for it. That is the other question that can, but I never said that the users,
Will have to be will have to pay. I think the government, I did mention that the government policy has actually helped in expanding the use of UPI. And I gave some numbers: 31 crore to 61 crore per day, UPI transactions, over the last two years.
Months, so I'll leave it at that, and then I'll request a change on.
Company Representative: Nothing else. I think that answers his questions.
If you have to add anything over there, nothing else, I think.
Governor of Reserve Bank of India: Okay.
Company Representative: Thank you, sir. Next, I will request Mr. Hitesh from Indian Express.
That answers this question. Yeah.
Thank you, sir. Uh, next, uh, I'll request Mr. Hitesh from Indian Express.
Journalist 2: Sir, in the monetary policy report, you have made some assumption with the crude oil at TLT 70 per barrel and rupee at 86. Is there any need to change it, the current situation?
Sir, in the uh, morning policy report, you have made some assumption with, uh, uh, crude oil at Tuesday, uh, 70 per barrel and, uh, rupee at 86. Is there any, uh, need to change it?
The current, uh situation.
Governor of Reserve Bank of India: We just did the, we just did this modeling. We have just taken these assumptions. As of now, obviously, there is no need to change it. Going forward, what happens? It's evolving. Things evolve. Earlier, we had taken some other numbers. As data comes in, I'm not saying you know that these are sacrosanct and I'll stick to these. No. I'll not be so presumptuous to say that. But as of now, yes, these are the best estimates that we have.
We, we just did the...
uh, we just did this, uh,
Uh, modeling.
We have just taken these assumptions.
As of now obviously there is no need to change it.
Going forward. What happens? It's evolving things evolve earlier. We had taken some other numbers.
And as data comes in, I'm not saying, you know that these are sacrosanct and I will stick to these. No.
I'll not be so presumptuous to say that.
Journalist 2: Thank you so very much, sir. Lastly, we will have Ben from New Indian Express. That is it, sir.
Uh, but as of now, yes, these are the best estimates that we have.
Journalist 1: Hi, sir. You have mentioned the volatility in the food prices many a time during the conference also. There is some talk about, or there is some call by some economists for taking out the food basket from the rate and inflation. What is the RBA's and the NPC's view on that? Is there any talk between NPC or RBA?
Thank you so much, sir. Lastly, we have Ben from the New Indian Express. That's it, sir.
Hi sir.
You have mentioned that volatility in food prices many a time during.
Office. Also, uh, do they? There is some talk about, or there is some call based on the club.
To take out the food basket from the retail inflation. What is the RBA's? And the NCS? We want that is.
Governor of Reserve Bank of India: Our target is certainly the headline inflation. The FIT is due for a review. Every five years, we do it. There is a discussion paper which we are preparing and which we will open to public consultation. After that, you know, you will be taken, the final view has to be taken by the government. We will give our views to the government as to how, you know, we should move ahead in this regard.
The talk within the PC. Our target is totally the headline inflation.
and uh, the
Fit is due for a review. Every 5 years. We do it.
Discussion paper, uh, which we are.
Preparing.
And uh, which we will open, uh, to public consultation.
And after that, you know, we will be taking the final view that has to be taken by the government. We'll give our views to the government as to how we should move ahead.
In this regard.
Journalist 2: Thank you, sir.
Thank you. Thank you.
It will be for the public health, right?
Yeah.
Company Representative: It will be for the public also, right?
Governor of Reserve Bank of India: Yeah.
Company Representative: Thank you, sir.
Governor of Reserve Bank of India: For the public.
Company Representative: Thank you, sir. With this, we come to the close of this press conference. I thank the top management of Reserve Bank for answering all the questions. I thank you all for making it very interactive. Have a nice afternoon and good day.
Governor of Reserve Bank of India: Thank you.
Thank you, sir. Thank you, sir. With this, we come to the close of this press conference. I thank the top management of the Reserve Bank for answering all the questions, and I thank you all for making it very interactive. Have a nice afternoon and a good day.
Thank you very much.
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