Growth outlook: Indian economy set to post high growth despite global headwinds; RBI flags domestic demand strength

India is projected to record high economic growth despite a volatile and unfavourable external environment, supported by strong domestic consumption and investment, Reserve Bank of India Governor Sanjay Malhotra said on Wednesday, PTI reported.“Maintaining financial stability and strengthening the financial system remains our north star,” Malhotra said in the foreword to the latest Financial Stability Report released by the RBI. He said financial sector regulators recognise that stability alone is not sufficient, and that promoting innovation and growth, protecting consumers, and adopting a pragmatic approach to regulation and supervision are equally important.“The most important contribution the policymakers can make is to foster a financial system that is robust and resilient to shocks, efficient in providing financial services and promotes responsible innovation,” Malhotra said.The governor noted that India’s economy and financial system remain robust and resilient, backed by strong growth, benign inflation, healthy balance sheets of financial and non-financial firms, sizeable buffers and prudent policy reforms.“Despite a volatile and unfavourable external environment, the Indian economy is projected to register high growth, driven by strong domestic consumption and investment,” he said, adding that the central bank remains mindful of near-term challenges from external spillovers.Malhotra said the RBI will continue to build strong guardrails to safeguard the economy and the financial system from potential shocks.