'Ensure appropriate liquidity at affordable cost'

New Delhi, Apr 22: PHD Chamber of Commerce and Industry (PHDCCI) today urged the RBI to ensure appropriate liquidity at affordable cost in its Annual Monetary Policy to be released on Tuesday.

''The soft interest rate structure needs to be pursued to maintain the momentum of growth,'' said PHDCCI President Sanjay Bhatia.

Mr Bhatia added that so far the stance of Monetary Policy emphasised on reinforcing price stability while ignoring growth.

RBI hiked the repo rate to 7.75 per cent and the Cash Reserve Ratio to 6.5 per cent which hardened the interest structure. The PLR of the banks had also gone up and ranges from 12.5-13.5 per cent.

''This is quite high when compared to prime rate of other countries. To improve the competitiveness of Indian industry lending rate structure needs to be brought down,'' he said.

He suggested the spread between deposit and lending rate to be around two per cent.

''To improve the liquidity, RBI should reduce CRR in a phased manner from 6.5 per cent to its target of 3 per cent,'' Mr Bhatia opined.

UNI