The Hindu Business Line : `Credit Policy focus is on continuity'

Terming it as "a carefully drafted policy focussing on continuity," Mr K. Satish Reddy, Chairman of CII (AP), said it focused "on the need for continuity."

"Given the already soft interest rate regime and the recent 50 basis point cut in the repo rate, CII understands why the RBI has kept the bank rates unchanged at 6 per cent. Similarly, given the excess liquidity in the financial system, there may have been no urgency to immediately reduce the cash reserve ratio (CRR)," Mr Reddy felt.

The RBI permitting banks to increase the loan limit without collateral to well performing small-scale units from Rs 15 lakh to Rs 25 lakh would benefit the SSI segment.

The chamber also hailed RBI increasing the GDP forecast in the range of 6.5 per cent to 7 per cent. "The higher GDP growth forecast, coupled with RBI's expectation of lower inflation, will bring further good cheer to industry," said Mr Reddy.

Meanwhile, the Federation of Andhra Pradesh Chamber of Commerce and Industry (FAPCCI), too, was happy about the revision of growth forecast upward.

The chamber, however, felt that "much better growth rate could have been achieved by providing better credit facilities to the small-scale sector." It also wanted incentives for savings to go up.

"Some avenues must be made available for the public to channelise their savings into better yields as these savings have to take care of them in their old age," the FAPCCI said in a statement here.

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