RBI's move disappointing, will write to FM & governor: Sharma

RBI in its monetary policy today kept repo, CRR rates unchanged

Disappointed over RBI not reducing interest rates, Commerce and Industry Minister Anand Sharma today said he will be shooting off letters to both finance minister and Reserve Bank governor seeking a relook at the credit policy.

"The RBI's decision, whatever reason they have based it on, is disappointing and will not help in reversing the trend when it comes to the core sector manufacturing ... I shall definitely be writing both to the Finance Minister and the RBI Governor," he told reporters here.

Pointing out that for the last eight months industrial production has been adversely impacted, Sharma said he was expecting "some positive news as far as investments are concerned". He said investment sentiments were low.

Industry has been blaming high interest rate regime for slowdown in economic activities in the country.

In the mid-quarter monetary policy review today, the Reserve Bank kept key interest rates unchanged in view of rising inflation and global economic uncertainty.

Sharma also said there was inflation in the manufacturing sector as the rate of price rise has declined in the segment from 7% to 5% over the past eight months.

The Minister said inflation is mainly due to food articles, and therefore "there is a case of a relook (on interest rates)".

Industrial production growth rate slowed down sharply to 0.1% in April from 5.3% a year ago due to contraction in capital goods and dip in manufacturing output.