By Mr. Abhay Ray 
Introduction
Reserve Bank of India Governor Sanjay Malhotra has urged the US industry to invest in India, stressing that the country continues to be the fastest growing major economy supported by policy consistency and certainty. Addressing the US-India Economic Forum organised by the Confederation of Indian Industry (CII) and US India Strategic Partnership Forum (USISPF) on Friday, Malhotra said that India is expected to record a growth rate of 6.5 per cent in the current financial year despite tremendous increase in uncertainty and volatility in global financial markets.
‘Sanjay Malhotra’ Urges US Businesses to Tap into India’s Growth Story
In a recent address to US investors and business leaders, Reserve Bank of India (RBI) Governor Sanjay Malhotra highlighted India’s robust economic fundamentals and its potential as a leading global investment destination. Emphasizing the nation’s strong GDP growth, digital transformation, and pro-business reforms, Malhotra called on American firms to seize emerging opportunities across sectors such as fintech, infrastructure, green energy, and manufacturing. He pointed to India’s large consumer base, growing middle class, and resilient financial ecosystem as key drivers of long-term growth. “India is not just an emerging market it’s an accelerating engine of global economic progress,” Malhotra said.
The Governor also underscored the central bank’s commitment to maintaining macroeconomic stability and fostering a transparent, investor-friendly environment. His remarks were part of a broader initiative to deepen India-US economic ties and attract strategic foreign investment.
Background of Governor Sanjay Malhotra
Sanjay Malhotra, appointed as RBI Governor in December 2024, has a distinguished career spanning over three decades in various sectors, including finance, taxation, power, and information technology. He holds a Bachelor’s degree in Computer Science from IIT Kanpur and a Master’s in Public Policy from Princeton University. His diverse experience positions him well to navigate India’s economic challenges and opportunities.
Key Policy Measures under Governor Malhotra
- Monetary Policy Adjustments: In April 2025, the RBI reduced the repo rate by 25 basis points and shifted its policy stance from “neutral” to “accommodative.” This move aims to stimulate economic growth and improve liquidity conditions, potentially making India more attractive to foreign investors.
- Enhanced Forecasting Techniques: Governor Malhotra has initiated a review of the RBI’s forecasting tools to improve the accuracy of inflation and growth projections. This includes integrating new data sources and machine learning tools, which could enhance investor confidence by providing more reliable economic indicators.
- Liquidity Management: The RBI aims to maintain a liquidity surplus of around 1% of deposits, approximately ₹2 trillion ($23 billion), to support effective monetary policy transmission. This proactive liquidity management strategy is designed to ensure stability in the banking system, which is crucial for attracting foreign investment.
- Foreign Exchange Reserves: Under Malhotra’s leadership, India’s foreign exchange reserves have risen to $630.6 billion as of January 31, 2025. This increase reflects the RBI’s efforts to manage currency volatility and bolster investor confidence.
India’s 6.5% Growth Expectation
The Reserve Bank of India also said that the Indian economy is likely to grow 6.5 per cent this year despite the rising global uncertainties due to the ongoing trade war between the United States and other world nations.
Governor Malhotra also said that this rate is lower than that of recent years. However, it remains broadly in line with past trends.
“While this rate is lower than in recent years and falls short of India’s aspirations, it remains broadly in line with past trends and the highest among major economies,” said Governor Malhotra at a speech in Washington, reported the news agency Bloomberg.
The outlook for the Indian growth story has taken a hit after US President Donald Trump sparked a global trade war with his ‘reciprocal tariffs.’ Reserve Bank of India (RBI) started cutting interest rates in early April, overall changing its monetary policy stance to accommodative which signals more easing in the economy.
Demand and Stability
The governor further underlined India’s robust domestic demand contributing 90% of GDP as a key buffer against global shocks, along with deepening capital markets and strong bank balance sheets. Gross FDI inflows rose to $75.1bn in April-February 2024-25 from $65.2bn USD during the same period a year ago. However, he asserted that net FDI inflows moderated during this period due to higher repatriations and outward investment.
The foreign exchange reserves also stand at a healthy $686bn, covering nearly a year’s worth of imports. He also noted that while offering excellent opportunities for investment, the banking sector is also poised to meet the investment needs of the industry and society, as the private debt to gross domestic product (GDP) is still on the lower side.
“We are committed to further enhancing the capacity, responsiveness and resilience of the banking and non-banking financial sectors with emphasis on balancing regulation with efficiency and stability,” the governor stated.
Conclusion
Governor Sanjay Malhotra’s address underscores India’s strategic positioning as a top global investment destination. With robust economic growth, policy stability, and a strong domestic demand base, India offers significant opportunities for U.S. investors across sectors like fintech, infrastructure, and green energy. The RBI’s accommodative stance, rising foreign exchange reserves, and proactive financial reforms further reinforce a favorable investment climate. As global uncertainties persist, Malhotra’s message is clear: India remains a resilient, growth-oriented economy ready to partner with international businesses for long-term progress.
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