RBI will ensure ample liquidity to aid growth, says Shaktikanta Das

The Reserve Bank of India (RBI) Governor Shaktikanta Das on Friday said there is no need to worry as the RBI will ensure adequate liquidity to support growth.

In the absence of further borrowing under GST and an increase in government spending, there is no need to further expand the GSAP operations, Das added.

"The RBI will remain ready to undertake GSAP as and when warranted by liquidity conditions and will continue to undertake other liquidity management operations like Twist and OMOs," he noted.

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The central bank kept the key policy rates unchanged on Friday in an attempt to strengthen the speedy recovery of the economy.

"Let there be no concern about the adequacy of liquidity. RBI will ensure adequate liquidity to support growth," he said.

He mentioned that the 14-day variable rate reverse repo has been the key instrument under the liquidity framework and the potential liquidity overhang was over Rs 13 lakh crore, as the economy manifested signs of recovery from the COVID-19 pandemic.

"RBI has maintained ample surplus liquidity since the beginning of the pandemic for India's speedy recovery, with surplus increasing further during September under reverse repo," Das added.

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Overall liquidity injected during the first six months of this year comprising GSAP amounted to Rs 2.7 lakh crore as compared to Rs 3.1 lakh crore during FY21.

Regarding the GSAP Das said, "This process has to be gradual, calibrated, and non-disruptive. GSAP has been successful, coupled with other liquidity measures that made recovery conducive."