India Inc has said the reduction in key lending rate by 25 basis points by the Reserve Bank of India (RBI) is likely to revive investment and encourage consumption, thereby kick-starting the sluggish economy. It emphasized that it was now critical for banks to facilitate a faster transmission of rate cuts to ensure that the measures reap results.
Confederation of Indian Industry (CII) Director General Chandrajit Banerjee has said that the cumulative 135 basis points rate cuts this year coupled with a slew of measures announced by the government to provide growth stimulus to a variety of sectors is expected to lift growth from its current stupor and unleash animal spirits.
According to the PHD Chamber of Commerce and Industry President D K Aggarwal, repo rate cut will help induce demand and refuel economic growth in coming quarters. However, Exporters body Federation of Indian Export Organisations’ (FIEO) President Sharad Saraf, said the challenges in exports will continue and may aggravate with geo-political situation.