BUSINESS

Minister for cut in interest rates by RBI

Source:PTI
January 23, 2012 17:34 IST

Ahead of the monetary policy review by Reserve Bank of India, Commerce and Industry Minister Anand Sharma on Monday made out a strong case for lowering of interest rates because of industrial slowdown.

"We are of considerate view that interest rates for investment for industry should be lowered. We have taken up with the Finance Minister who is receptive and positive particularly for small and medium enterprises," Sharma told reporters on the sidelines of SAARC Business Summit organised by Federation of Indian Chambers of Commerce and Industry in New Delhi.

He expressed the hope that the central bank would 'take a considerate view' as the economy needs infusion of funds and more investment keeping inflation under control.

The RBI is scheduled to review its short-term lending rates on Tuesday, amidst apprehensions that it may not go in for interest rate cut even as the pause on the hikes may continue.

The central bank had hiked interest rates by 375 basis points between March, 2010 and October, 2011 to deal with the persistently high inflation, including rising prices of food items.

However, general inflation fell to a two-year low of 7.47 per cent in December, 2011. Food inflation stood at (-)0.42 per cent as of January 7.

The country's industrial production grew by 5.9 per cent in November 2011 as against 6.4 per cent in the same period a year-ago.

But it showed a bounce-back in November as compared to October 2011 when the factory output decelerated 4.74 per cent.

Image: Anand Sharma

Source: PTI
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