BCC welcomes RBI's Mid Term Review

Kolkata, Oct 24 (UNI) The Bharat Chamber of Commerce today welcomed the RBI's step of providing more priority to judicious balance between price stability, sustaining growth momentum and maintaining stability in financial markets.

Reacting to the RBI's Mid-Term Review of Annual Monetary Policy for 2008-09, BCC president P R Agarwala said in a statement, ''Measures like carrying forward development of various segments of financial markets and strengthening the financial market infrastructure are expected to have favourable impact on the prevailing lack of confidence, which is likely to dampen the midterm prospects for growth specially in the manufacturing sector.

''RBI Governor Dr S Subbarao measure of providing more priority to judicious balance between price stability, sustaining the growth momentum and maintaining stability in financial markets are welcome,'' Mr Agarwal said.

Focus on key areas like liberalisation of foreign exchange transactions, relaxation in the interest rate ceilings on NRI deposits, strengthening the supervisory framework in terms of cross-board supervision, surveillance over banks' credit portfolios, development of instruments and infrastructure relating to payment and settlement systems in response to financial innovations, strengthening Urban Co-operative Banks and Regional Rural Banks were all welcome measures, Mr Agarwala observed.

''Measures like simplification of lending procedures for crop loans, increae in interest relief from 2 per cent to 4 per cent per annum to farmers in respect of short term production credit upto Rs 3 lakhs and streamlining of the delivery system of credit to agriculture and other segments of the priority sector would help flow of increased agricultural credit to the farming community,'' he said.

In order to support growth and ensure availability of debt to the needy sector, the repo rate deserved further cut as expected by the industrial and banking sectors, Mr Agarwala added.

UNI PL KK DB/AB 1816