New Delhi: India's Macro Fundamentals Strong Amid Global Challenges, MoS Tells Rajya Sabha
“As a major player in global markets, India's economy is also linked with international trends, which impact its exchange rate movements": Union minister Pankaj Chaudhary
NEW DELHI: The government on Tuesday said that macroeconomic fundamentals of the Indian economy remain strong, supported by robust domestic demand, healthy corporate balance sheets and sustained fiscal discipline amid global challenges.
Informing Parliament, the Union minister, Pankaj Chaudhary said in a written reply in the Rajya Sabha that the RBI’s Financial Stability Report (June 2026) showed the domestic financial system remains resilient, underpinned by strong bank and non-bank balance sheets.
“As a major player in global markets, India's economy is also linked with international trends, which impact its exchange rate movements. Since the start of the West Asia conflict, the Indian Rupee (INR) has depreciated against the US Dollar ($) by 5.8 per cent in FY27 (from February 27 up to July 22, 2026),” the minister said.
He further said that economic growth continues to be supported by robust domestic demand, healthy corporate balance sheets and prudent fiscal management. “The high-frequency indicators for the first quarter of 2026-27 also point to sustained momentum in economic activity and domestic demand, indicating the continued resilience of the Indian economy,” he said.
The minister also said that the index of industrial production (IIP) recorded a growth rate of 4.9 per cent year-on-year (YoY) in April 2026 and 5.1 per cent YoY in May 2026, indicating continued investment-led industrial growth despite heightened global uncertainty. “The industries reliant on imported inputs may face cost pressures,” he said.
“Thus, to support stability, the Government is easing import-led inflation through duty adjustments, expanding MSME credit, ensuring affordable financing, attracting long-term FDI, promoting trade facilitation and digital platforms, and advancing free trade agreements," he added.
On rupee movement, the minister also said that the value of the INR is market-determined, with no target or specific level or band. “The RBI regularly monitors the foreign exchange market and intervenes in situations of excess volatility. Further, the RBI monitors key developments across the globe, which may have an impact on the USD-INR exchange rate,” he added.