.......Finance minister Pranab Mukherjee has blamed the Reserve Bank for high interest rates, and while it is true the RBI has raised interest rates 13 times since October 2010, each time it has been compelled to do so with the government failing to take fiscal steps needed to meet supply side constraints. These constraints fuelled food inflation, which then spilled over to manufacturing. High interest rates of 10-13 per cent for creditworthy corporates has certainly stifled growth: margins are not large enough to absorb such high rates. Demand has also slowed, and many companies can’t utilise even 70 per cent of their capacity. The RBI needs to cut interest rates immediately by at least one per cent, if not more, for growth is as important as inflation concerns. And the RBI must remember it is not the sole guardian of inflation..............
The very purpose of VITALINFO is to provide a platform for wider dissemination of updated information related to and happening of events in and around RBI.
No comments:
Post a Comment