With the credit growth still sluggish, the Reserve Bank of India (RBI) may not raise key policy rates, according to Suman K Bery, member of Prime Minister's Economic Advisory Council and director general of National Council of Applied Economic Research.
"I don't think so," said Bery when asked whether the Central bank should consider raising rates.
On the sidelines of an interactive session organised by the Bharat Chamber of Commerce, Bery said, "Globally we haven't seen any significant resumption in credit growth and the case is same for India as well. The real cost of finance for the borrowers are still high."
However, the RBI's stance will depend on the state of the global economy, particularly the commodity prices, which were still volatile.
Bery further said that the issues which India should focus in the G-20 forum are the role of international finance institutions, resources, quotas, cross border regulatory architecture, managing systematic risk and financial safety among other factors.
“The traditional concerns in the financial sector agenda have been financial inclusion, asset quality, SLR and monetary policy mechanism,” said Bery.
Also, in an economy with significant trade links and migratory population, strict capital control was difficult, he said.
