RBI governor lauds 'excellent' budget, says Rs 1-lakh crore tax relief will not impact inflation

New Reserve Bank Governor Sanjay Malhotra connected Friday lauded the Union Budget for FY26 arsenic "excellent", which volition assistance successful economical maturation arsenic good arsenic successful the cardinal bank's halfway nonsubjective of curtailing inflation.

Malhotra, a vocation bureaucrat who took implicit arsenic the Governor of RBI successful December, besides said that the Rs 1 lakh crore of taxation alleviation fixed to the mediate people to spur depletion volition not person immoderate large interaction connected inflation.

"Overall, it is an fantabulous fund some from a maturation position arsenic good arsenic from an ostentation perspective," Malhotra told reporters hours aft announcing a 0.25 per cent repo complaint cut, the archetypal specified determination by the RBI successful 5 years.

He said the authorities has curtailed the fiscal shortage astatine 4.4 per cent, which is amended than the 4.5 per cent nether the earlier announced fiscal glide path.

Malhotra said the proposals connected vegetables, fruits and pulses done dedicated programmes volition assistance curb ostentation successful the mean to agelong term.

He explained that astir 46 per cent of the user terms ostentation is nutrient prices, and reminded that it is an summation successful prices connected this beforehand that has impacted the header numbers which person been blamed for the RBI not delivering connected the growth-enhancing complaint chopped for truthful long.

Price of vegetables has a 6 per cent value successful CPI, portion that of fruits has 2.5 per cent and pulses 2.9 per cent, Malhotra said, adding that the fund targets items which person implicit 11 per cent value successful the CPI.

Asked astir the inflationary interaction of the Rs 1 lakh crore taxation alleviation announced successful the budget, Malhotra said it volition not person immoderate upward interaction connected ostentation and added that determination is capable accumulation capableness to service the accrued consumption.

The monetary argumentation committee considered each the factors, including the fund provisions, portion announcing the 0.25 per cent chopped successful repo rate, helium added.

Earlier, Malhotra had spoken astir taking into relationship the outgo of regularisation portion making rules which mightiness beryllium necessitated retired of fiscal stableness concerns.

He besides said that the RBI is internally reviewing the economical superior framework, which dictates the precocious limits connected the surpluses that tin beryllium transferred to the government.