RBI plays down deepening slowdown as just 'cyclical downswing'

The Reserve Bank says the ongoing growth deceleration is a "soft patch mutating into a cyclical downswing", and has underlined reviving consumption and private investment should be the highest priority for policymakers and government.

In the annual report for FY19, released Thursday, the central bank concedes that diagnosing the exact problems is "difficult", but reiterates that the issues are not structural in nature, barring those around land, labour and agri produce marketing.

"The key question that confronts the economy is: are we dealing with a soft patch, or a cyclical downswing, or a structural slowdown?" the RBI, which has revised down its GDP forecast to 6.9 percent earlier this month, says and concludes that "the ongoing deceleration can be in the nature of a soft patch mutating into a cyclical downswing, rather than a deep structural one."