Enthused by the pro-reform approach adopted by new RBI Governor Raghuram Rajan, the industry body, Confederation of Indian Industry (CII) expects that the central bank would shift focus towards an expansionary monetary policy by cutting interest rates which in turn would spur investments and bring back economic growth. CII president K Gopalakrishnan said that various reforms suggested by the RBI governor including financial inclusion, facilitating investment flows, promoting financial savings, addressing the rupee depreciation and rising inflation are timely and reflect an innovative approach to tackle the hurdles facing the economy and revive investor confidence.
Raghuram Rajan, after taking charge as the 23rd Governor of the central bank has laid out a detailed roadmap for his innings in the short-term and came out with a slew of measures, including more trade settlement in rupees to rescue the battered financial markets and hinted at a shift in focus from inflation control pursued by his predecessor, to boost the economic growth, which slowed down to the four year low at 4.4 percent in the April -June quarter of this fiscal.
Gopalakrishnan further said that amidst various degrees of uncertainty owing to an array of global and domestic issues that the industry in India is faced with today, the RBI can be a pillar of strength and provide direction and the RBI Governor’s statement on the issue of internationalization of the Rupee and capital inflows, is indicative of bold thinking.
