Interests' moderation after inflation decline: FM

Kolar (Karnataka), Apr 15: Union Finance Minister P Chidambaram today said the interest rate, that went up sharply in the recent weeks, would be moderated once the inflation rate came down.

''The interest rates were increased to bring down inflation which has crossed the six per cent mark before coming to the sub six per cent mark last week,'' he told reporters on the sidelines of a conclave for women self-help group members of the district at Honnenahalli village on the outskirts of this town.

Once the inflation rate was moderated, the interest rate would also decline, he said, adding that no time frame had been fixed to bring down the interest rate.

Mr Chidambaram said that during 2000 and 2001, inflation rate was above six per cent for 48 weeks out of 52 weeks. After the UPA took over the reigns of the Union Government, the inflation had ruled above six per cent only for the last nine to ten weeks.

Asked about inflation hitting the poor badly, he said ''you cannot complain about inflation and then complain about anti-inflationary measures as well. Our immediate goal is to moderate inflation to about five per cent or so.'' On whether the Rupee had lost its sheen in the present circumstances, the Minister said ''I think the Rupee is still very competitive compared to other currencies.'' However, some other currencies have appreciated more.

The appreciation in Rupee was mainly due to the huge inflow of capital, foreign direct investment, foreign institutional investments, export earnings and remittances by NRIs, which was good for the country, he said.

UNI