IMC welcomes credit policy

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Mumbai, Apr 30 (UNI) Indian Merchants' Chamber today welcomed the annual credit policy, announced by the RBI, with thrust on containing inflation, leaving key rates unchanged.

''The Government must firefight the growing threat of inflation through measures that do not disturb investments and growth and this is exactly what RBI has accomplished, ensuring appropriate liquidity to meet credit needs'' IMC President M.N.Chaini said in a release here.

He said ''It is heartening to note that the RBI has retained the overall real GDP growth projection for 2008-09 at around 8.5 per cent'' IMC also appreciated the small beginnings that have been made in the policy, such as encouragement to financial inclusion in the housing segment and exhorting banks to be careful henceforth on their commodity loans.

The emphasis on credit delivery, in particular, for employment-intensive sectors, while pursuing financial inclusion, was a welcome feature of the RBI's credit policy, it said.

However, RBI's wish to moderate money supply expansion (M3) in the range of 16.5-17 per cent during 2008-09, was not commensurate with a persistent annual growth rate of 8 per cent in GDP and 25-30 per cent in the financial sector and therefore an area of concern, Mr Chaini said.

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