set out therein have been accomplished. the vision of rbi is to ensure that all ‘ payments and settlement systems in the country are safe, efficient, interoperable, authorised, accessible, inclusive and compliant with international standards ”. as i mentioned earlier, a sound and efficient payment system is a pre - requisite for a stable financial system and with the increasing volume and value of transactions, central banks can ill - afford to ignore payment systems. rbi has also initiated the process of setting up of payment banks to further financial inclusion. role of npci 9. you would have gone into the details of the role of npci in the sessions during the course of this conference. since, i had the distinction of serving on the board of npci for some time, i would briefly say a few words on the role and achievements of npci. it was set up with an objective of ensuring pan - india payment systems with uniform business processes and standards and has already created an enabling eco system necessary for handling this huge task. some of the achievements of npci which have significantly altered the retail payments landscape in the country are as under : • the national financial switch ( nfs ), a vast network of atms, has enhanced accessibility to cash withdrawal and other basic banking facilities for customers, besides facilitating value added services such as bill payments. • cheque truncation system ( cts ) – it has been rolled out successfully in three grid locations across the country covering over 85 % of cheque volume processed. npci has now begun to facilitate the repository of images of cheques processed in cts. • immediate payment service ( imps ) which started in october 2010 as an inter - bank mobile payment system has, over the years, transformed into a multi - channel 24x7 remittance platform in the country, accessible through net banking, mobile banking, at bc point, at branches as well as at atms. • rupay – the domestic card system which was launched in 2011 has slowly gained popularity and with its linkage under the jan dhanyojana has become a household name. • aadhaar based payments, through linkage of biometric identifier with bank accounts, is facilitating the benefit payments to bank accounts of millions of beneficiaries, and will have significant on financial inclusion efforts in the country. • national unified ussd platform ( nuup ) – the setting up of national unified ussd platform for providing an interoperable ussd based mobile

real economy 7. under the impact of external demand shocks, the indian economy witnessed moderation in growth in the second half of 2008 – 09 in comparison with the robust growth performance in the preceding five years ( 8. 8 per cent per annum ). the deceleration in growth was particularly noticeable in negative growth in industrial output in q4 of 2008 – 09 ; a decline for the first time since the mid - 1990s ( table 1 ). this was on account of erosion of external demand which affected industrial performance ; a reflection of increasing globalisation of the indian industry. 8. the transmission of external demand shocks was swift and severe on export growth, which declined from a peak of about 40 per cent in q2 of 2008 – 09 to ( – ) 15 per cent in q3 and further to ( – ) 22 per cent in q4 ; a contraction for the first time since 2001 – 02. concurrently, domestic aggregate demand also moderated resulting from sharp deceleration in the growth of private consumption demand. in order to respond to the slowing demand, fiscal stimulus measures were undertaken by the government which included both tax cuts and increase in expenditure. this raised the fiscal deficit of the central government by 3. 5 per cent of gdp in 2008 – 09. consequently, the growth in government final consumption expenditure registered a sharp increase in q3 and q4 of 2008 – 09 ( table 2 ). it is, however, important to note that unlike many countries the entire fiscal stimulus in india was aimed at addressing the deficiency in aggregate demand rather than extending support to the financial sector. while this meant a deviation from the planned fiscal consolidation path as committed under the fiscal responsibility and budget management ( frbm ) act, without the stimulus the deceleration in gdp growth during 2008 – 09 would have been much sharper. table 1 : key macroeconomic indicators – india indicators 2008 – 09 : q1 – q4 2009 – 10 : q1 – q2 real gdp growth ( y - o - y ) ( % ) industry services q1 7. 8 5. 1 10. 0 q2 7. 7 4. 8 9. 8 q3 5. 8 1. 6 9. 5 q4 5. 8 – 0. 5 8. 4 q1 6. 1 4. 2 7. 7 q2 – – – inflation ( y - o - y ) ( % ) wpi cpi - industrial workers 12. 0 7. 7 12. 1 9. 8 5. 9 9