He told CNBC-TV18, "I think today the economy is in good trim, the worry is if interest rates continue to rise and I am not saying they will because I believe there are moderating factors, but we will have to see. But if interest rates continue to rise, then it could put a break on the sort of growth and investment plans and indeed consumer demand, but at this point of time, I don't think we have to fear that."

 Excerpts from an interview given to CNBC-TV18

 What are your views about the PM's concern on excessive remuneration?

I think we need to look at what he said in the larger context - the 10 points of agenda that he set and those ten points basically underscore what I would call affirmative action. I would say inclusive growth, sustainable growth, and skill development. At the same time, in terms of conspicuous consumption he made this comment, and the point is well taken.

 Yes, but the fact that he talked thrice in his speech about high salaries being given to CEOs, about CEO compensation, he talked about the next holiday destination that senior executives are looking at, what do you make of the reason and the rationale behind the PM bringing it out at least four times in his speech?

I think he was sending a message and the message was very clear to all of us in the audience and you saw the response Sunil Bharti Mittal gave, that these points are going to be taken well and are going to be acted upon by the industry. I do hope industry responds in the same spirit.

He also talked about the need to break cartels and not allow cartels to operate in the country. That almost seems to suggest that there was an assumption that cartels were operating. He talked specifically about commodities sector?

I would look at it this way - we are a growing economy and at this stage of our economic growth there is a risk that cartelisation could happen. It is early to say whether cartels are already formed. But for a country growing at 10% and a trillion dollar economy, and where this could have a debilitating impact, I think it is appropriate that we look out for signals of anything that could derail us or bring instability.

Speaking about things that could derail us, the rally that we have seen as far as the rupee is concerned - the hike that we have seen in interest rates, how worried are you about both these at this particular point in time?

I would think this is a part of the market mechanism. If we put the economy in context, then you have an economy that is growing in the 9%-10% range. There are signs of inflation and there are steps to curb inflation and that is where you see interest rate being used - as a tool to curb inflation. And then there is also the strong inflow of dollars into the country, and that is strengthening the Indian rupee.

 I think this is a part of a competitive process, where the Indian industry will have to learn to balance. They will have to learn to balance growth aspirations, balance funding costs and a stronger rupee and it is to their credit that over the last few years, they have overcome great odds and I am sure they will learn to live in the reality of today i.e. managing all these different things at the same time.

We are already hearing about 38-39 for the rupee, is that something you would agree with?

I don't speculate on interest rates or exchange rates but I look at fundamentals, which are strong and as long as inflows are going to exceed outflows, I think the pressure will be on the rupee to strengthen.

Will there be a possible CRR hike?

That is another thing I don't speculate on.

The measures that have been taken to tame inflation, do you seem a little less bothered by where inflation is?

I would look at several things happening, one is the measure taken and equally important, you have large capacities that is being created across industries - the 300 billion investment that we keep talking about out of the total of 500 billion that we expect here to be spent over the next three years. A large part of this is in manufacturing (in capacity creation) and I think that should de-bottleneck most areas, which otherwise could have cost problems. So, you have measures taken, which I think should moderate inflation going forward and of course on the food front with the crops coming in, we should be able to control inflation.

Given the external environment and given the external and internal triggers, what would be your biggest worry at this point in time?

I think today the economy is in good trim, the worry is if interest rates continue to rise and I am not saying they will because I believe there are moderating factors but we will have to see. But if interest rates continue to rise, then it could put a break on the sort of growth and investment plans and indeed consumer demand, but at this point of I don't think we have to fear that.

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