India not pursuing dollar alternative: CEA Nageswaran clarifies on economic conditions; assures resilience amid global tensions

NEW DELHI: Chief Economic Advisor (CEA) V Anantha Nageswaran on Tuesday clarified that India is not participating in any initiative to create an alternative to the US dollar, confirming that no such plans are under consideration. Speaking at an AIMA event, he highlighted India’s economic resilience despite global trade tensions and tariff disputes, as quoted by Economic Times. The CEA noted that combined effects of US tariffs and recent GST modifications are expected to reduce FY26 GDP growth projections by 0.2–0.3 per cent, keeping forecasts in the 6.3–6.8 per cent range.The country achieved 7.8 per cent real GDP growth in Q1 FY26, driven by increased economic activity rather than low inflation. Early indicators from July and August suggest the positive momentum is continuing into the second quarter. Among G20 nations, India stands out as the only economy to maintain robust growth consistently over the four years following the COVID-19 disruption.Reforms, Fiscal Discipline and Future Focus Nageswaran attributed India’s economic stability to a decade of structural reforms integrating digital and physical infrastructure improvements with formalisation of SMEs. Initiatives such as the Insolvency and Bankruptcy Code, GST, RERA, and public sector bank consolidation have improved business conditions, while recent GST and tax administration reforms have simplified compliance. Highlighting international confidence, he pointed to India’s sovereign credit rating upgrade to BBB from BBB-, the first in nearly 20 years, which has lowered borrowing costs, with 10-year government bond yields falling from 9 per cent to 6.4 per cent. Steady energy prices over the past four years have also helped contain inflation. Fiscal discipline remains a priority, with the government on track to meet its 4.4 per cent fiscal deficit target for FY26. Looking ahead, Nageswaran emphasised competitiveness, innovation, and productivity as key growth drivers. He stressed the need for cooperation between government and the private sector, urging businesses to prioritise innovation over protectionism and provide meaningful opportunities for India’s young workforce in an increasingly digital economy.