India's Strategic Fiscal Maneuver Amid West Asia Crisis

India's Finance Minister Nirmala Sitharaman assures that India has the fiscal capacity to support sectors hit by the West Asia crisis, while the Reserve Bank may cut interest rates. She highlights India's debt management strength amid global volatility, emphasizing the country's fiscal prudence over the past decade.

Finance Minister Nirmala Sitharaman has asserted that India retains fiscal flexibility to assist sectors affected by the escalating West Asia situation. She stated that the Reserve Bank has the room to reduce interest rates in response to international challenges, ahead of the Monetary Policy Committee's upcoming decision on rate stance.

The Reserve Bank's rate-setting committee initiated its discussions on Monday, with expectations pointing towards a status quo. Sitharaman remarked on the increasingly complex global landscape, noting the Middle East conflict's transition from a regional issue to a systemic threat to global energy stability and asserting a new multipolar world order.

Addressing the National Institute of Public Finance and Policy event, she underlined India's commendable debt management, maintaining an 81% debt-to-GDP ratio, the lowest among major economies. Sitharaman emphasized India's advantage from sustained fiscal prudence, reflected in recent reductions in excise duty on fuels, mitigating consumer impact amid the crisis.

(With inputs from agencies.)