We are thinking about local currency lending to India: Anshula Kant, CFO, World Bank

The World Bank is contemplating the possibility of offering loans in local currencies to nations such as India, aiming to provide borrowers with cost-saving advantages, as indicated by a senior official on Friday. Anshula Kant, the Managing Director and Chief Financial Officer of the World Bank, shared insights on this matter, emphasising the exploration of methods for local currency lending tailored to India's context.

 "How do we do local currency lending for a country like India is also something we are trying to think of at a price which is advantageous to this country," said Anshula Kant.

Addressing a gathering focused on the global economy, jointly organised by the Ministry of Finance and the Reserve Bank of India (RBI) as part of India's G-20 presidency, Kant highlighted India's distinctive position in terms of local currency borrowing compared to the World Bank, despite the World Bank's AAA rating. She acknowledged the potential for significant benefits associated with India's local currency borrowing capability.

However, Kant acknowledged that the local currency lending approach might not be viable in countries like certain African nations where the necessary market infrastructure for the bank's borrowing is absent.

Global inflationary pressures are easing

During the event, V Anantha Nageswaran, the Chief Economic Advisor to the Government of India, expressed optimism about the easing of global inflationary pressures, surpassing earlier expectations. He underscored the persistent concerns related to core inflation and emphasised the importance of aligning fiscal and monetary policies.

Ashima Goyal, an academic and an external member of the monetary policy committee of the RBI, emphasised the role of monetary policy in addressing the need for financial stability. She highlighted the significance of ensuring that monetary policy appropriately caters to the requirements of maintaining financial stability.

(With PTI inputs)