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RBI cut in lending rate complements govt's measures for growth: FinMin

The government has taken a slew of measures since August 23 to pull the economy out of a six-year low growth and a 45-year high unemployment rate by reviving private investments

Press Trust of India  |  New Delhi 

Focus on sustainability of agriculture, not loan waivers, says RBI

The on Friday said the Reserve Bank's decision to lower benchmark will complement recent measures taken by the government to accelerate growth.

Earlier in the day, cut the repo rate by 25 basis points to 5.15 per cent.

Government has noted the reduction in repo rate from 5.40 per cent to 5.15 per cent announced by the Monetary Policy Committee (MPC) and believes that this will complement the recent measures taken by the government to accelerate growth, an official statement released by the said.

The government has taken a slew of measures since August 23 to pull the economy out of a six-year low growth and a 45-year high unemployment rate by reviving private investments.

Last month, the government cut corporate tax rate by almost 10 percentage points, a move which has a tax implication of Rs 1.45 trillion.

As part of the exercise, the government also withdrew enhanced surcharge on long- and short-term capital gains for foreign portfolio investors as well as domestic portfolio investors with revenue implication of Rs 1,400 crore.

It further said that the government has also taken note of revised growth projections of MPC at 6.1 per cent for 2019-20 along with growth projections made by other bodies, including the IMF, ADB, among others.

The government has further taken note of higher projection of headline inflation by MPC for 2019-20, which is within the band of 3-4 per cent and well within the target range, it said.

First Published: Fri, October 04 2019. 15:35 IST
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