Commenting on Reserve Bank’s mid-quarter monetary policy review, Planning Commission Deputy Chairman Montek Singh Ahluwalia has emphasized on lowering of interest rates to boost economic growth which is beginning to look up after moderating to 5.4 per cent in the first half of the current fiscal. However, during March 2012, Finance Ministry had projected a growth rate of 7.6 per cent for the current fiscal.
As the fiscal deficit declines, the resources which are flowing into the financing of fiscal deficit, will flow back into the economy. Further, Ahluwalia added that deceleration in growth has bottomed out and the second half would be better and as the RBI has chosen to keep all the key rates and ratios unchanged in its policy review unveiled, but have decided not to take any action. By adding further the Deputy Chairman said that the government is taking steps to promote infrastructure sector projects.
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