Sitharaman sees strong growth outlook, calls for reforms

Union Finance Minister Nirmala Sitharaman on Monday said India remains well-positioned for sustained economic growth, supported by strong domestic demand and macroeconomic stability, but emphasized that continuous reforms, innovation and institutional strengthening will be crucial to maintaining the country's growth momentum in an increasingly uncertain global environment.
Speaking at the Mindmine Summit 2026, Sitharaman said India has performed reasonably well on the economic front and continues to demonstrate resilience despite geopolitical tensions, supply chain disruptions and global market volatility.The Finance Minister said the government, in coordination with the Reserve Bank of India, is preparing additional measures to attract greater foreign capital participation and deepen India's integration with global financial markets.

Delhi: At the Mindmine Summit 2026, Union Minister Nirmala Sitharaman says, "That some areas are going to be dry and some others are going to have excessive rain. That's a year-long, every year concern. But this year, because of the El Nino, I think we are preparing for not so… pic.twitter.com/7IZXfE2WKK

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Addressing concerns regarding foreign institutional investor (FII) participation and capital flows, Sitharaman said India requires higher levels of overseas investment to support its long-term growth ambitions and infrastructure development plans.“We recognize we need more foreign capital to come in. Certainly, that's not the end of the story. We'll be doing more,” she said, indicating that policymakers are working on a broader strategy to facilitate capital inflows.
Highlighting recent initiatives aimed at improving India's appeal among global investors, Sitharaman said the government and the RBI have already introduced measures to make the country's bond market more accessible. These include easing compliance requirements through the Fully Accessible Route (FAR) framework and providing favourable withholding tax treatment for foreign investors.According to the Finance Minister, these reforms are helping strengthen investor confidence while expanding opportunities for overseas participation in Indian debt markets.She also pointed to the RBI's framework allowing public sector undertakings and banks to raise funds from international markets. Under the mechanism, currency-related hedging costs are borne by the central bank, enabling institutions to access overseas capital more efficiently.
“As a result, the banks can now go unfettered to raise capital from outside,” Sitharaman said.The minister noted that India's large domestic market and robust consumption demand provide an important cushion against external economic shocks. However, she cautioned that global challenges continue to pose risks to growth prospects.
She cited fluctuations in crude oil prices, disruptions in global supply chains, geopolitical conflicts, rising insurance costs and climate-related uncertainties as factors that require close monitoring by policymakers.Sitharaman stressed that strong economic growth must be supported by efficient institutions, sound governance frameworks and effective policy implementation.“I know that our country is doing reasonably well, but we must continue to evaluate our performance carefully and identify areas where further improvement is needed,” she said.
The Finance Minister emphasized that policy frameworks must remain dynamic and adaptable as economic conditions evolve. While several sectors have recorded strong expansion, she observed that certain segments involving complex and intermediate products and services still require targeted policy interventions and structural reforms.She said policymakers must continue exploring innovative approaches to address long-standing challenges and ensure that the benefits of growth are distributed across all sections of society.
On weather-related risks, Sitharaman said the government is closely monitoring the potential impact of the El Niño phenomenon and preparing for the possibility of a weaker-than-normal monsoon.“Some areas are going to be dry and some others are going to have excessive rain. That's a year-long concern. But this year, because of El Niño, I think we are preparing for a not-so-good monsoon,” she said.The Finance Minister added that the government remains vigilant about emerging domestic and global developments and is committed to strengthening India's long-term growth prospects through sustained reforms, policy support and institutional capacity building.

(Business Correspondent)