"It's Contagious! No Country Can Tackle It in Isolation," Says FM Nirmala Sitharaman on Global Inflation

At the CII Global Economic Policy Forum on 11th December, 2024 Finance Minister Nirmala Sitharaman admitted inflation continues to be a major challenge globally. She also remarked that the problem cannot be tackled in isolation.

"Inflation major challenge globally, no country can tackle it in isolation," said Sitharaman. “Inflation globally is a big challenge, it's contagious,” she added. “Primary cause of Inflation is disruptions.”

Reasons for inflation

While listing out the priorities for the next decade, the Finance Minister shared that unabated inflation, unsustainable debt, disruption of supply chains, and lack of food security are among the top challenges that the industry and the government need to work together. 

“The industry, along with policymakers, will have to work on larger goals to address global concerns. Need to restore global calm, not enough justifiable reasons for war and disruptions of supply and food value chains,” the Minister stated.

She elaborated that policymakers should be sensible enough while decision-making. “No political risks should threaten the well-being of people,” she affirmed. “Supply chain lessons should tell us that the industry needs to realign not only from an economic sense," she added.

Responding to issues about high debt levels of governments at national and state levels, the finance minister shared that future generations cannot be burdened with unsustainable levels of borrowing.

“Responsible economies can't run with large borrowings. Important for governments, industry to work on how debt can be managed at national and sub-national levels. Cannot burden the fourth generation with unsustainable debt,” she said.

The Finance Minister expressed confidence in India’s agri stack or the digital infrastructure project aiming to improve agriculture in India using data and digital services.

“Climate change has put forth a challenge to find resources to build infrastructure to withstand extreme vagaries of nature,” Sitharaman remarked.

“Climate challenges need to be looked at from other areas apart from emissions. We need to ensure food security. Agriculture practices need to be looked at to replace some crops without depending upon too much on water. It will reduce inflationary pressures on agriculture,” she added.

She also pointed out that the industry needs to train the youth in particular skill sets.

“The industry should work on priority to ensure youth get trained in the skill sets they need. That needs to be a decadal priority as much as for the government. Access and opportunities for youth in far-flung areas need to be generated,” the Minister finished.

Also read: Adani Group to Invest Rs 7.5 trillion in Rajasthan on Renewable Energy (startuppedia.in)