In the foreword to the eighth edition of the RBI’s Financial Stability Report 2013, released on Monday morning, RBI chief Raghuram Rajan says the country needs a stable government at the Centre in 2014.
If the upcoming polls fail to throw a clear verdict, nation’s economy will be dragged down further, he adds.
“A potential additional source of uncertainty is the coming general election. A stable new government would be positive for the economy,” Rajan said in his foreword to the eighth edition of the RBI’s Financial Stability Report 2013.
Warning that any political instability will lead to further erosion of investor confidence in the economy, Rajan said, “With confidence in the financial system still fragile, six years into the crisis, policy certainty is something that investors look for in the current environment.”
Experts are not ready to believe GDP will grow at over 5 percent as claimed by the UPA government, and many of them peg it at a little over 4 percent this fiscal.
The RBI report is likely to put the UPA 2 government in a spot even as opposition parties and even some of the allies have been criticising the ruling dispensation for corruption and wrong economic policies.
However, do you think people will take it seriously and elect a decisive government in the coming elections? Shar your opinion.
