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| PM panel mulls relief for housing, core sectors | |
| BS Reporters / New Delhi December 3, 2008, 0:18 IST | |
 The government is likely to announce early next week a series of measures to boost economic activity in the country. This includes cheap credit to exporters and low-cost housing as well as making available additional funds worth Rs 50,000 crore to the infrastructure sector.
There is also a possibility of the Reserve Bank of India announcing another set of cuts in key policy rates like the cash-reserve ratio and the repo rate.
According to government sources, these measures were discussed at a meeting of an apex panel of ministers, headed by Prime Minister Manmohan Singh and formed to deal with the economic slowdown. The sources added that though the broad contours of the package have been finalised, the finer points are yet to be put in place.
The government is likely to provide cheap credit to labour-intensive export sectors including textiles, leather, handicrafts, marine products and gems and jewellery. This could be provided through a two per cent interest subvention for export related loans. The move is likely to cost the government around Rs 1,000 crore.
The government is also likely to extend the period of post-shipment export credit from 90 days at present to about 180 days. Additional export relief measures may include increased duty drawback rates used by exporters to get back duties like excise paid on producing goods for overseas sales.
The sources said the government may also provide interest subvention for low cost housing. The maximum limit for such loans is likely to be Rs 10 lakh. In its deliberations earlier, senior government officials had found that more than 70 per cent of the housing loans were below Rs 7.5 lakh. This move is likely to generate industrial activity by creating demand for cement and steel.
The Planning Commission has also proposed a Rs 50,000-crore fund for the infrastructure sector. The fund will be operated through India Infrastructure Finance Company Ltd. This will ensure that infrastructure projects like airports, roads and power plants do not get stuck due to the lack of funds.
Today’s meeting was attended by RBI Governor Duvvuri Subbarao, Planning Commission Deputy Chairman Montek Singh Ahluwalia and Home Minister P Chidambaram. Commerce Minister Kamal Nath, who is also a member, could not attend the meeting as he was in Madhya Pradesh.
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Discussion Board
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| rpsu |
December 03 , 2008 ,16:39 IST |
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| recently on 14th November 2008, Reliance finance has increased my mortgage loan rate from 14.25 to 14.75%. When all other banks are decreasing interest rate, how can they increase. I do have lock in period for one year and after that 2% penalty for early repayment. Do you think they are taking advantage of my situation? Can you please help me out? Just for your info, they have increased rates for all of their clients. |
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| Mahi |
December 03 , 2008 ,11:13 IST |
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| Industrialists just know profit and UPA government is helping them out to squeeze the poor people of this country and make profit.
Nobody from real estate industry care about low cost housing for poor for past four years and in future also they will not care. Giving real estate industry bail out which has 80-90% margin is simply ridiculous idea. No vote for UPA in next election. This hopeless government should go???. |
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