India Inc wants more measures from RBI

India Inc today demanded additional measures including cutting interest rates further and infusing additional liquidity to alleviate the hardship arising out of the liquidity crunch.

The Confederation of Indian Industry demanded that in order to improve domestic liquidity and reduce interest rates, the central bank should further reduce repo rate by at least 50 basis points and also cut CRR by 150 bps,

The monetary authority should also create a line of liquidity to Mutual Funds and NBFC sectors, to enable orderly operation of financial markets, said Chandrajit Banerjee, Director General of the body.  All bank deposits need to be guaranteed for a two-year period, to maintain depositor confidence in the banking sector, the body said.

 

To prevent excessive volatility in the currency, focused exchange rate management is required. The foreign exchange reserves should be used directly for meeting critical foreign currency needs.

The Federation of Indian Chamber of Commerce and Industry wants RBI to cut interest rate to be brought down to 10 per cent from the present 15 per cent to give a boost to growth.

Rajeev Chandrasekhar, MP and President, FICCI said that the last few quarters of focus on inflation management through monetary policy measures has seriously weakened India's economic growth momentum.