Indian realty sector welcomes RBI’s biannual appraisal of Monetary Policy

What has been the reaction of India Inc. regarding the half yearly review of the Monetary Policy by the Reserve Bank of India? Well, the significant Indian industry chambers have welcomed it already.

Let’s check the reactions of some prominent tycoons then. As per Mr. Venu Srinivasan, President, Confederation of Indian Industry (CII), RBI Governor has clearly decided to allow the recovery process to strengthen by leaving the key rates unchanged. With demand still not strong enough and the industrial recovery at a nascent stage this was necessary and CII welcomes the RBI Governor’s announcement.

On the other hand Mr. Harsh Pati Singhania, President, FICCI, through expressing identical views said, it is heartening to note that the RBI has chosen growth over monetary tightening and inflationary fears. While FICCI welcomes this positive move of the RBI, the policy signals the beginning of a gradual withdrawal of the exceptional measures taken by the RBI to tackle the crisis. Hopefully, the policy will continue to ensure the availability of credit at the right cost at a time when the industrial growth has started to revive.

He also stated, SLR increase to 25 per cent hopefully will not have any material impact on liquidity, as banks’ investments in SLR securities is already much higher than this. While RBI has decided to restore the export credit refinance facility to the pre-crisis level of 15 per cent (from 50 per cent currently), hopefully, it should not result in the cost of export finance increasing as there seems to be adequate liquidity in the system.”

What has been the reaction of Dr. Swati Piramal, ASSOCHAM President, then? Speaking on the Monetary Policy she made it clear that RBI Monetary Policy is on expected lines which strikes a fine balance between growth and inflation. All growth drivers have been kept intact since the bank did not tinker with its existing repo rate, reverse repo rate and cash reserve ratio.