Reacting to the RBI’s decision of increasing the repo rate by 40 basis points to 4.4 percent and CRR by 50 basis points to 4.5 percent at a time, when world economy including India is reeling under inflationary pressures, Dr A Sakthivel, President, FIEO said that this was on expected line looking at the current and evolving macroeconomic situation and expected increase in the key rates by the US Federal Reserve. Dr Sakthivel welcomed the initiative taken by the Central Bank of the country, as it will not only help in containing inflation but will also support the economic growth process including exports. However, at the same time RBI should ensure that it neither affects the credit flow nor the interest burden on MSMEs and exporters and if required, the Interest Equalisation Scheme may enhance the support to insulate against any rate hike.
