Home / Knowledge / News / Cut Interest Rates to strengthen economic fundamentals
Cut Interest Rates to strengthen economic fundamentals
Jan '08
Following the US Federal Reserve rate cut by 75 basis points, Mr Sunil Bharti Mittal, President, CII has strongly suggested an urgent need to cut interest rates to strengthen the macro economic fundamentals of India Economy in an increasingly uncertain global economic environment due to slowdown in the US economy.

With inflation under control and hovering around 3 per cent, it is the right time for RBI to cut repo and reverse repo rates that are currently at 7.75 per cent and 6 per cent respectively by 25 to 50 basis points to cover the relative competitive disadvantage India is currently in on macro economic fundamentals.

This move would strengthen the economic fundamentals and also boost investors' confidence, said the CII President, in a Press Release issued.

CII has further noted that the decline in IIP in the recent months could trigger a slowdown in the Indian manufacturing sector, especially in the consumer durables sector, which has witnessed a negative growth at -1.7 per cent during the period April-November 2007 when compared to the corresponding period last year, said the release.

In its recommendations for the quarterly review of Monetary Policy 2007-08, the CII President expressed concern over high interest rates affecting investments and growth and suggested that the time is right to recognize the need to reduce interest rates, which is pivotal to sustain 9 per cent plus GDP growth.

Furthermore, India would need investment rates in excess of 36 percent of GDP to achieve 9-10 per cent GDP growth in the medium term, which is again important to raise per capita income, reduce income inequalities and alleviate poverty, said Mr Mittal, in the release.

Mr Sunil Mittal strongly feels that reducing interest rate would go a long way in boosting demand and investments. It would also reduce the operating costs of exporting SMEs who have been facing decline in profit margins due to an appreciating rupee.

The impact of high interest rates have been severe on SMEs, especially exporters, who have been the worst hit due to the appreciating rupee which has eroded their profit margins significantly.

Confederation of Indian Industry

Must ReadView All

Apparel/Garments | On 27th Mar 2017

NYCEDC announces $51mn package for NYC garment industry

New York City Economic Development Corporation (NYCEDC), in...

Apparel/Garments | On 27th Mar 2017

Fynd raises $500K Series A funding from Venture Catalysts

Fynd, an online to offline (O2O) e-commerce fashion marketplace, has...

Apparel/Garments | On 27th Mar 2017

India's fashion market to touch $30 bn by 2020: Report

The fashion market in India is estimated at $70 billion in 2016, with ...

Interviews View All

Hannah Lane

Encouragement from brands will motivate supply chains to become more...

Kaizad Hansotia

Competition is the best thing that can happen to a startup

Ajay Ghariwala
Luthra Group

We are ready to adopt or follow every opportunity

Mohammad Hassan
Biax Fiberfilm

About one in every 20 patients picks up an infection while hospitalised....

Kevin Nelson

Kevin Nelson, Chief Scientific Officer, TissueGen discusses the growing...

Larry L Kinn
Suominen Corporation

Larry L Kinn, Senior Vice President - Operations Americas of Suominen...

Madhu Jain
Madhu Jain

She grew up in the walled city of Old Delhi, completed her studies, and...

Sonam & Paras Modi

Sonam and Paras Modi's Sva Couture is synonymous with head-turning...

Jay Ramrakhiani
Occasions Elegance Wear

It is believed that by early 19th century, Varanasi weavers had moved away ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


Letter To Editor

(Max. 8000 char.)

Search Companies

March 2017

March 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Browse Our Archives


Subscribe today and get the latest News update in your mail box.
Advanced Search