How India Inc is Reacting to RBI Rate Cut

Bangalore: The lower rate of economic growth in India has pushed the Reserve Bank of India and the Central Government to take mandatory measures for boosting up the financial health of the nation. RBI has cut down the Cash Reserve Ratio (CRR), repo and also the reverse repo by 25 basis points. This will cut down the cost of loans for home, auto and in other fields.

The decision taken by RBI will surely power up the economic growth as the lower CRR will introduce an additional amount of 18,000 crore to the nation. According to some of the officials, this action of the RBI and the Central government will give rise to the capabilities of the banks.

One of the senior Adani Power official said that “The repo rate cut will also bring down the interest rate. If inflation falls and RBI does a redux it will give the right fillip to the economy”

The market still expects something more from the government. Mr. Anand Rathi, a Senior Analyst said that the market expects another reduction of 50 basis points by June 2013 and at least a total of 100 basis points in 2013. Most of the experts are now expecting a better result in the upcoming Union budget.

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