“In the midst of death, life persists; in the midst of untruth, truth persists; in the midst of darkness, light persists,” said RBI Governor Shaktikanta Das on Friday as he began his media briefing amidst a steep fall in Rupee and the continuing volatility in other segments of the financial markets owing to the Coronavirus pandemic.

This is the second time the RBI Governor is addressing the media since the country began the lockdown on March 25.

Amid the crisis, the RBI has slashed the reverse repo rate by 25 basis points to 3.75 per cent from 4 per cent due to the Coronavirus-related economic challenges.

The apex bank has already slashed the repo rate by 75 basis points to 4.4 per cent in a bid to tide over the disastrous impact of the virus on economy.

The Rupee fell 0.55 per cent to a new record low of 76.86 against the US dollar on Thursday, while the equity indices have been on a see-saw in the wake of the Coronavirus outbreak losing over 30 per cent since January.

Before going into the pandemic’s impact on the economy, Das thanked frontline workers and also the RBI employees for having kept the economic needs going.

“We salute frontline workers and our employees too who are working tirelessly to keep the economic needs going.” he said, adding that mission is to “do whatever it takes to prevent the curve from steepening.”

Shaktikanta Das said at a time when the humanity is facing the trial of its time, as COVID-19 has gripped the world with its deadly embrace, the Reserve Bank of India has been very proactive and monitoring the situation closely.

In his address, Das noted that the macroeconomic environment has deteriorated precipitously since March 27. But light still shines through bravely in some others, he said.

The RBI governor further said crude oil remains volatile but India is among a handful of countries with positive GDP.

Das said that the impact of the outbreak is not captured in IIP Print and warned not to get “mislead by that data.”

He also cited the International Monetary Fund’s (IMF) global growth projections revealing that in 2020, the global economy is expected to plunge into the worst recession since ‘The Great Depression’.

IMF Economic Counsellor has named it ‘The Great lockdown’ estimating cumulative loss to global GDP at around 9 trillion US dollars, which is greater than the economies of Japan and Germany combined.

The RBI has, however, said that India will continue to grow at 1.9 per cent during the current fiscal year.

“India is among the handful of countries that is projected to cling on, somewhat tenuously, to positive growth rate of 1.9 per cent. This is the highest growth rate among the G-20 economies as estimated by the International Monetary Fund (IMF),” Shaktikanta Das said at the video conference.

However, for 2020-21, the IMF has projected sizable reshaped recoveries, close to 9 percentage points for the global GDP, he said and added that India is expected to post a sharp turnaround and resume its pre-COVID, pre-slowdown trajectory by growing at 7.4 per cent in 2020-21.

Contraction in exports in March 2020 at 34.6 per cent, turned out to be much more severe than during the Global Financial Crisis, he observed.

Amidst all of this, he said the foreign exchange reserves continue to be robust. The RBI governor has said that India has enough Forex reserves for 11.8 months of imports and is “well maintained at $ 476.5 billion.”

Speaking about India’s crop productions, Das stated that Kharif output was up by 37 per cent but services PMI contracted due to a sharp downturn due to export hit. 25-30 per cent sharp decline has occurred in electricity demand due to the virus, he added.

Shaktikanta Das further said that RBI’s liquidity injection has been at 3.2 per cent of GDP since February 6 to March 27, 2020. “Systemic liquidity surplus averaged at Rs 4.36 lakh crore as of March-end 2020,” he said.

He said the Government will be conducting TLTRO 2.0 for an aggregate amount of Rs 50,000 cr. “This TLTRO amount can be stepped up as necessary to ensure various segments of the market (NBFCs MFIs etc) get enough liquidity.”

He also added that the government is taking measures to maintain adequate liquidity in the system, facilitate and incentivise bank credit flow, ease financial stress and enable formal functioning of markets.

In view of tightening of financial conditions due to the crisis, Das said the government has decided to provide special refinance facilities of Rs 50,000 crore to NHB, SIDBI and NABARD.

The RBI governor in his address further said that the apex bank has increased WMA limit of state government by 60 per cent. He also said the Targeted Long-Term Repo Operation (TLTRO) auction of Rs 25,000 crore will be conducted today.

Meanwhile, Das has asked banks to “not declare dividends until further notice.” He said that the LCR requirement for banks have been brought down to 80 per cent from 100 per cent with immediate effect in view of the economic crisis.

“Loans given by NBFCs to commercial real estate to get some relief. This is to ease NBFCs and the real estate sector. New measures shall be announced as and when need arises,” he said.

“Finance is the lifeline of an economy,” the RBI chief said, adding that it is important for cash to keep flowing for the economy to function amidst the Coronavirus crisis.

He further stated that “inflation may settle below the target of 4 per cent by H1FY21, barring any supply-side disruption and shocks.”

The RBI Governor’s address comes a day after PM Modi met Finance Minister Nirmala Sitharaman to discuss economic situation in the country following the lockdown due to Coronavirus pandemic.