1. RBI governor Urjit Patel at BRICS seminar : ‘Our economies overshadow the world’

RBI governor Urjit Patel at BRICS seminar : ‘Our economies overshadow the world’

The Reserve Bank of India governor Urjit Patel addressed the BRICS seminar on Investment Flows in Mumbai on Thursday and said that it was heartening to see the BRICS community grow in size and stature.

By: | Updated: October 13, 2016 1:09 PM
RBI Policy, RBI Monetary Policy, RBI Policy Today, rbi policy announcement todayurjit patel, urjit patel brics, urjit patel rbi, reserve bank of india chairman, urjit patel brics speech, urjit patel brics address Urjit Patel informed that the BRICS’ investment-GDP ratio was 19% in Brazil to 45% in China, who was only a testament to the strong appetite for aggregate demand. (PTI)

The Reserve Bank of India governor Urjit Patel addressed the BRICS seminar on Investment Flows in Mumbai on Thursday and said that it was heartening to see the BRICS community grow in size and stature. He was of the opinion that the BRICS offers a vast pool of investment opportunities. Addressing the seminar, he said that India needed to manage commodity price cycles much better than it currently is. He further added that the spillovers from the global monetary policy remained a major risk to the BRICS community.

He also stated that it was difficult to convert capital flows into investible resources. Talking about the defects of the member countries of the BRICS, he said that their economies reflected a lack of absorptive capacity. He further informed the seminar that the outlook for global commodity prices remained soft. BRICS nations’ average economic growth was seen to be 5.1% this year, which overshadowed the 3.1%, for the world. Talking about the expectations from the BRICS economies, he said that the they are either expected to coast the current account deficits and reduce surpluses by providing vital support to the global aggregate demand.

He informed that the BRICS’ investment-GDP ratio was 19% in Brazil to 45% in China, who was only a testament to the strong appetite for aggregate demand. Although, he said that 3 challenges, however, against this backdrop. The main issue in channelling investment into global economies is headwinds, he said without speaking much about it. The 2nd challenge, he said was the management of spillovers. Although, he kept his focus on political risks, being the newest challenge to the cause, most importantly following the Brexit. He cited the example of the Brexit vote, the US elections and the political realignment towards the left or right; all of them severely affect the cause due to the change of policies.

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