........Many are criticising this move saying it will lead to more bad loans, besides leading to distortions. Even RBI Deputy Governor K C Chakrabarty was quoted as saying that it is not prudent to increase consumption by lowering interest rates because if the interest rate goes up, loans will become NPAs. How do you respond to that?
The RBI Deputy Governor was quoted completely out of context. He told me that the answer that he gave was in reference to a theoretical question asked by a student at a function he attended. That, unfortunately, has been taken and portrayed as some kind of criticism of the government policy. It was not............
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