High real interest rates making India uncompetitive, says Ajay Piramal

We will have to think of creative ways to encourage demand like the interest subvention in low-income housing loans, he said

The ailing non-banking financial sector needs immediate support from the central bank, says Ajay Piramal, chairman, Piramal Enterprises. The government must also address woes of the real estate sector on a priority basis for growth and job creation, he tells Abhijit Lele and Sohini Das. Edited excerpts:  

What should be done to revive non-banking financial companies (NBFCs)?
 

It is a crisis of confidence, which started with the Infrastructure Leasing & Financial Services (IL&FS) default. Out of its Rs 1.2-trillion exposure, its NBFC had lent only Rs 20,000 crore, and the balance Rs 1 trillion was in infrastructure. However, people do