RBI Governor proposes structural reforms in monetary policies

New Delhi : Days before the government is set to announce the budget for the financial year 2020, RBI governor Shaktikanta Das said that there is a huge need of making structural reforms in the monetary policies of the financial body.

"Monetary policy, however, has its own limits. Structural reforms and fiscal measures may have to be continued and further activated to provide a durable push to demand and boost growth," Das said on Saturday.

He added that steps like prioritising food processing industries, tourism, e-commerce, startups and efforts to become a part of the global value chain could give significant push to growth.

"The government is also focusing on infrastructure spending which will augment growth potential of the economy," Das said. 

The economic condition of India is on a downward track despite several measures taken by the government to boost it last year. 

Das also said that central banks need to take a view on the true nature of slack in demand and supply side shocks to inflation for timely use of counter-cyclical policies.

"In recent times, shifting trend growth in several economies, global spillover effects and disconnect between the financial cycles and business cycles in the face of supply shocks broadly explain why monetary policy around the world is in a state of flux," he said.