in fact, we are a unique federation where the boundaries of existing provinces are redrawn and new provinces are created, to accommodate aspirations, while remaining strictly within the provisions of the constitution. we have several national languages in which governments ’ businesses are conducted. every currency note that you see in india has the denomination written in seventeen languages with different scripts. in brief, independent india believes firmly, in dialogue, accommodation and assimilation of multiple identities of people. these characteristics enable the indian people and the indian corporates to live and work harmoniously alongside other nationalities. india ’ s record as a responsible nation in honouring its commitments is well known. specifically, independent india has never reneged on its monetary obligations to the rest of the world and has not sought any noticeable rescheduling of its payment obligations. in 1991, we had a liquidity crisis in currency, mainly due to the war in iraq and the breakdown of trade with ussr, but we preferred to pledge gold, initiate a massive import compression and start a reform process with assistance from the imf and the world bank. the entire burden of crisis and adjustment was successfully borne by the domestic economy. in the current environment of financial turbulence, and also a possible unwinding of macro imbalances, india plays a stabilising role with a modest current account deficit in most of the recent years, at around one per cent 1 of gdp, and a market determined exchange rate. india has not been contributing to the global macro economic imbalances, though it has a stake in how the issues get resolved in the near future. currently, there is a debate on the role of sovereign wealth funds. india is in receipt of investments from several of them either directly or indirectly, and hence, is interested in the current debate. for its part, the country ’ s foreign exchange reserves amounting to about us $ 300 billion continue to be managed by the reserve bank of india, typically as per mandate similar to those of other central banks around the world and consistent with the imf guidelines. however, the indian corporates, based on account of their own commercial judgements, take investment positions and merge or acquire other undertakings in other countries. public policy neither provides incentives nor disincentives for such market based initiatives by the indian corporates. india ’ s external sector has displayed considerable strength and resilience since the reforms in 1991 – despite several domestic as well as global political events and supply shocks in food and fuel. interestingly,

, consequently, a more significant slowdown in economic activity. however, in contrast to the quarantine imposed last year, this time supply will be more affected than demand, which could increase pro - inflationary pressures. what is more, a more protracted global price surge than currently expected will put pressure on domestic prices. other pro - inflationary risks also remain important. they include : a sharp deterioration in terms of trade, capital outflows from emerging markets and an escalation of the military conflict with russia. what will the nbu ’ s monetary policy stance be in future? as set forth in the baseline scenario, with a view to bringing inflation back to its 5 % target, the nbu will keep its key policy rate no lower than 8. 5 % at least until q3 2022 rather than until q2, as was expected in july. the key policy rate will be cut more gradually in 2022 than forecast before. the key policy rate is also expected to stand at 7. 5 % in late 2022, as opposed to 6. 5 %, as predicted in the previous forecast. 2 / 3 bis central bankers'speeches if the said or any other pro - inflationary risks materialize, the nbu stands ready to raise its key policy rate and deploy other monetary tools. it could decide to do so even during the december meeting. thank you for your attention! 3 / 3 bis central bankers'speeches