Commenting on RBI Policy announced today Mr. Harshavardhan Neotia, President, FICCI, said, “RBI’s move to cut the repo rate is welcome and is very timely. We hope that going ahead this would translate into a greater pass through by the Banks and would yield into further lowering of lending rates”. “The decision to supplement the demand conditions by maintaining an accommodative stance is definitely encouraging. The companies have reported an improvement in the capacity utilization rates and demand is expected to gain further traction given the forthcoming festivities, however, there is still a need to assure that this turnaround is sustainable.
At this juncture, it is important that all the policy levers are put into action to back growth”, said Mr. Neotia. “The performance of the industrial sector has been volatile and would need continued support. The cost of capital has to be more competitive to drive investments. Businesses need to see an urgent revival in growth. Also, a moderate interest rate regime will lead to an uptick in interest sensitive sectors such as consumer durables, automobiles and housing”, added Mr. Neotia.