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India in a relatively stronger position than many other countries: Finance secretary

Saying that the fiscal situation was less challenging last year, T V Somanathan stressed that the government will work on maintaining growth and fiscal stability, while the primary responsibility of controlling inflation lies with the Reserve Bank of India.

May 13, 2022 / 01:26 PM IST
Finance Secretary TV Somanathan

Finance Secretary TV Somanathan

Despite rising prices of fertilisers and crude oil putting pressure on the economy, India is “in a relatively stronger position than many other countries”, finance secretary T V Somanathan told CNBC TV18 in an exclusive interview.

“India is adversely less affected than others (countries) who are adversely more affected than us,” Somanathan said. He argued that India has at least escaped the global foodgrain crisis in the wake of the Ukraine-Russia war, owing to the large domestic production of wheat.

Saying that higher fertiliser prices pose a difficulty, Somanathan said it will have a big fiscal impact. “The government has already announced its fertiliser subsidy for the forthcoming season. There is going to be a substantial increase in the budget for fertiliser subsidies. It will certainly be above Rs 2 lakh crore,” he said.

On crude oil, he said that while prices are high, they haven’t climbed much in the last one month. “Over the last 30 days oil prices have been flat. Since prices were raised at the retail level, the trend line of crude prices has been largely flat. We have to see how the situation evolves. There are multiple variables affecting it, whether sanctions are tightened in Europe or it gets better if alternative sources open up in Iran or Venezuela,” he said.