India may not join hawkish central banks of emerging economies yet

The economic destruction from the pandemic and ensuring policy support from the central banks of emerging market economies have been similar. RBI released on Thursday that Countries which have tightened monetary policy are growing rapidly. Countries such as Brazil, Russia, Mexico and South Africa have hiked policy rate by a big margin in 2021. The Gross Domestic Product in some of these economies had returns to pre-pandemic level.
RBI has said that it is difficult to compartmentalize the country within these categories. But a net commodity importer with a lower proportion of the population vaccinated, India cannot afford to give up on its accommodative policies despite recent signs of inflation flare- ups are mostly still supply- side triggers it believes.
The share of vaccinated population has shaped policy response. Countries which have larger share of population inoculated have been able to tighten policy faster.

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