agricultural outlook and the pickup in rural demand. sustained buoyancy in services would also support urban demand. 21. resilient growth has given us the space to focus on inflation so as to ensure its durable descent to the 4 per cent target. the government schemes such as production linked incentive ( pli ) scheme, pradhan mantri awas yojana ( pmay ) [ expanded to construct 3 crore additional houses ], pradhan mantri gram sadak yojana ( pmgsy ) [ launching of phase iv ], national infrastructure pipeline ( nip ) and viability gap funding would provide impetus to capital formation. headline inflation trajectory is projected to sequentially moderate from the last quarter of this financial year. unexpected weather events and worsening of geopolitical conflicts constitute major upside risks to the inflation outlook. 22. a continuing priority for the reserve bank has been to strengthen the financial sector. the health parameters of banks and non - bank financial companies ( nbfcs ) are now very robust. this has resulted in sustained credit flows, especially to the remote and underserved segments, bolstering financial inclusion. 23. as i said in my last monetary policy statement, today, the indian economy presents a picture of stability and strength. the balance between inflation and growth is well - poised. the external sector demonstrates the strength of the economy. forex reserves are scaling new peaks. fiscal consolidation is underway. the financial sector remains sound and resilient. global investor optimism in india ’ s prospects is perhaps at its highest ever. we are, however, not complacent, especially amidst the rapidly evolving global conditions. thank you.

both public and private creditors, ensures timely debt restructuring, and links debt relief with sustainable development objectives. without such reform, the vulnerable countries will continue to face unsustainable debt burdens which will have repercussions for global financial stability. 6. third, we must recognise the fragility and fault - lines of the global monetary and financial system, both institutions and markets. recent years have highlighted the risks posed by financial instability, in both advanced and emerging markets. there indeed is a pressing need to improve global financial regulation to manage systemic risks posed by private capital and non - bank financial intermediaries, which now hold significant portions of global assets. the rise of shadow banking and fintech, and the growing footprint of decentralised finance, require more robust regulatory oversight to prevent contagion effects and ensure financial stability as a global public good. 7. the fourth area of concern is the digital divide. as the global economy becomes more digitalized, countries that lack the infrastructure, skills, and regulatory frameworks for digital inclusion risk falling further behind. the g20 and the international monetary and financial institutions should work towards nurturing an ecosystem that promotes investment in digital public infrastructure, and widespread adoption of digital technologies while ensuring cybersecurity and privacy safeguards. 8. fifth, geopolitical tensions are increasingly affecting economic policies, leading to sanctions, weaponisation of finance, trade restrictions and supply chain disruptions. this is causing economic fragmentation, as countries aim for strategic independence in key areas like energy, technology and strategic materials like semiconductors and critical minerals. the g20 must play a key role in preventing further economic fracturing by promoting open and rules - based trade systems. while recognising the need for countries to secure their supply chains in tactically important sectors, the g20 should foster cooperation in areas such as technology transfer, investment in global public goods, and green transition. 9. sixth, perhaps and above all, climate finance must be at the forefront of the g20 ’ s priorities and the international monetary and financial agenda. the international financial system must mobilise significantly greater resources to fund the transition to a low - carbon economy. the g20 must also coordinate national efforts to ensure that climate policies do not lead to protectionism, unilateral trade barriers or trade conflicts. the rise of border carbon adjustments ( bcas ) and similar measures must be managed through cooperative frameworks to avoid unnecessary economic fragmentation. additionally, there is an urgent need for