Putting the Economy First in the Face of Global Challenges says FM Sitharaman

India’s Finance Minister, Nirmala Sitharaman, reinforced the government's commitment to economic growth as a key policy goal at the launch of “A World in Flux: India’s Economic Priorities.” She credited public capital spending for sustaining growth amid global uncertainty and outlined three key priorities: fostering job creation, amplifying the Global South’s voice, and balancing fiscal prudence with growth. Sitharaman also emphasized strengthening FDI policies and reforming multilateral institutions to address global challenges, positioning India as a leader in economic restructuring.

Nirmala Sitharaman, India's Finance Minister, said again that the government is committed to keeping the country's economic growth as a main policy goal. He was speaking at the launch of the book "A World in Flux: India's Economic Priorities." Essays in Honour of Dr. Shankar Acharya"* on July 26, Sitharaman talked about how strong public capital spending has been a big part of keeping the economy going, even though the world economy is facing more uncertainty.

"Ensuring steady economic growth is our top priority," Sitharaman said. "It directly leads to job creation and inclusive development." She said that India's economic growth was mainly due to public capital spending and emphasised that the government's goal was to keep the economy stable by making investments that would lead to growth.

India's economic policy should focus on the following areas:

The Finance Minister talked about India's three main policy goals that determine its present economic and geopolitical strategy:

1. Consistent economic growth and job creation

India's policy framework is still based on economic growth, with a focus on providing jobs and making sure that everyone has the chance to succeed. Sitharaman stressed that an environment that supports people who want to do well is very important for letting groups of people who have high hopes do well.

2. Being a leader for the voice of the global south

India wants to make sure that the worries of developing countries are heard on a global level so that their views have an impact on international policy and changes to institutions.

3. Finding a balance between prudence and growth

Sitharaman said that the government is still committed to lowering the ratio of debt to GDP and putting growth-boosting spending first. "Fiscal discipline doesn't have to mean cutting spending on things that will help the economy grow," she said.

Getting investments and making FDI policies stronger

Foreign direct investment (FDI) is a big part of economic growth, so Sitharaman said that both the national government and state governments needed to make it easy for global investors to do business.

"Policy on FDI must remain investor-friendly," she said. "State governments are now actively competing to bring in investments." It was emphasised that India's economic strength after the pandemic was due in large part to FDI, public capital spending, and earlier changes like lowering corporate taxes and fixing the "twin balance sheet" problem.

Finding Your Way Through Global Change and Changing Multilateral Institutions Sitharaman called for structural changes in governance frameworks to deal with new problems because global institutions are becoming more fragmented and uncertain. "Current structures are not equipped to handle the challenges of the next century," she said, emphasising the need to change multilateral institutions to adapt to new global conditions.

India's recent presidency of the G20 was a key chance to push for these important changes. "Reforming multilateral institutions was the main goal of India's G20 presidency," Sitharaman said, emphasising that these groups need to change in order to stay useful in a world that is changing quickly.

Leading in the Face of Global Challenges

In her speech, Sitharaman made it clear that India wants to be a leader in the process of remaking the world economy. By making policies that are just right, the government hopes to deal with problems in other countries while also keeping growth strong in the United States.

As the Finance Minister said again, India's economic strategy is based on a mix of public capital spending, policies that encourage investment, and a commitment to fiscal discipline. India continues to be a major player in the world economy by putting these areas at the top of its list of priorities.