Rajan meets Finance Minister Arun Jaitley

Reserve Bank Governor Raghuram Rajan today met Finance Minister Arun Jaitley and is believed to have discussed a host of issues, including macroeconomic situation.
"It was a regular meeting," Rajan said after the meeting.
While most of macroeconomic indicators are showing signs of economic revival, food inflation remains slightly a concern area.
Retail inflation rose to 14-month high of 5.41 per cent in November on sharp pickup in food prices, posing a challenge to further easing of monetary policy by the Reserve Bank.
The wholesale price inflation, although in negative zone for the 13th consecutive month, also moved up to (-)1.99 per cent in November as food articles including pulses and onion turned costlier. It stood at (-)3.81 per cent in October.

India's GDP growth rose to 7.4 per cent in July-September, outpacing China to become the fastest growing major economy.

While the gross domestic product or GDP of Asia's third-largest economy expanded 7.4 per cent in the second quarter from 7 per cent in the previous quarter, growth rate of eight core infrastructure industries slowed to 3.2 per cent in October.
During the same quarter, the current account deficit (CAD) narrowed to 1.6 per cent of GDP at USD 8.2 billion mainly due to lower trade deficit.
With regard to fiscal deficit, the government has already announced its commitment to meet the target of 3.9 per cent for the current fiscal.

"I think we've done exactly what was needed," Rajan said,
adding that the central bank should continue to prioritise low inflation.
Rajan rocked too many boats while heading the RBI -- earning 'ad hominem' attacks and also open criticism by those wanting him to be faster with rate cuts and much slower on cleaning the balance sheets of banks.
But those showering him with bouquets were numerous too, giving him titles like 'Rockstar Rajan' and 'Bond of Mint Street', which he himself appeared to acknowledge by once remarking -- "My name is Rajan and I do what I do" -- a clear play on the introductory dialogue of the famous British spy character James Bond.

On Indian economy, he offered a less-than-ringing endorsement of the government's emphasis on manufacturing in India - what the prime minister has called his Make in India campaign.
Rajan said he did not support the view of critics that it was too late in world economic history for India to become a manufacturing hub. But he also said he would not focus exclusively on manufacturing as the solution to joblessness.
If India improves infrastructure and reduces government regulations, manufacturing might take off in a big way, but it "could also be services. It could be value-added agriculture also".
Although China's economy has overshadowed India's in recent decades, Rajan said he is still a believer in democracy as the better system to create long-term growth.

"India's strengths to some extent come also from its democracy. Things can get bad in India, but not beyond a certain point, because the democratic process asserts itself. And we have a change in government," he said.