Mumbai, April 22 : Amid rising criticisms about RBI’s stance of maintaining a status quo on repo rates while the inflation is going up, HDFC Vice-Chairman and CEO Keki Mistry on Friday said that the apex bank is not behind the curve and that 2-3 rate hikes are possible during the year. Speaking at the Times Network’s India Economic Conclave, Mistry opined that there is no need for India to do what the US Fed is doing in terms of increasing the rates. “I truly don’t believe that we are behind the curve in terms of rates. I believe that there would be rate hikes during the course of the year, maybe 2-3 rate hikes are very much possible. But I don’t see that impacting the economy and I certainly don’t see the need for India to do what the US Fed is talking of doing and be so sharp in the terms of rate hikes,” he added. The comments come at a time when the Reserve Bank of India (RBI) has been criticised for being behind the curve in tackling the inflation risk emanating from global geo-political tensions. Praising the RBI for managing the crisis that arose due to the Covid-19 pandemic, Mistry said, “The speed at which the Indian economy has bounced back is truly fantastic and you have to give credit to the government and the RBI for the way they have handled the crisis. RBI has ensured that right through the crisis, there was always adequate liquidity in the system.” Stating that money was never a constraint, he said the RBI not only brought down the interest rates, but ensured that every segment of the market has access to the liquidity. “So u didnt see any failures in India as you saw in other parts of the world. We handled the economy very well,” Mistry added. Speaking about the rising inflation, the banker noted that it is wrong to compare India to the US. “When we talk about inflation, then let’s not compare India with the US as it is totally wrong to do that. The US historically had extremely low inflation, while India historically had higher inflation. So the gap between inflation in the US and India historically used to be more than 400 basis points. Today, we are in a situation where the US has inflation of over 8.5 per cent, whereas we are expecting inflation in the next year to be 5.7 per cent or so. So, we are 2.8 per cent lower than the US.” The US, which was never used to having inflation, therefore has to take extremely drastic measures in terms of increasing interest rates. Mistry, however, opined that it is extremely important for the Indian economy to maintain the growth because growth will create jobs, and jobs will create income and income will lead to consumption. “Even if this means slightly higher inflation, so for some time, so be it,” he added. Speaking about the rising crude prices, he said, “A lot of inflation is an imported inflation. Oil was USD 75 a barrel, or so and today it is USD 107 a barrel. But it is not going to be USD 107 barrel for the full year. So if you assume that oil settles at Rs 90-95 barrel on an average for the year, we are looking at inflation coming down in the course of the time,” Mistry added. PSK SHK1702