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Status Quo in Key Rates Expected for Balancing Growth, Inflation: FIEO

FIEO President, Mr Sharad Kumar Saraf

New Delhi:

Port Wings News Network:

Commenting on the Monetary Policy announcements made by the RBI today, Mr Sharad Kumar Saraf, President, FIEO said that status quo in the key rates was expected, looking into the need for balancing growth and inflation particularly as hike in global import prices of commodities will continue to push inflationary pressures.

Mr Saraf agreed with the RBI’s assessment that enhanced and targeted policy support are required for exports and it is opportune time now to give further policy push by focusing on quality and scalability. He said that scalability could be attempted only if there are adequate profits in exports so that the same may be ploughed back in expansion and upgradation. However, at present the profit margins have been squeezed due to high input prices without corresponding hike in prices of exports and sky rocketing freight costs. He urged that a stable policy framework may be provided by notifying RoDTEP Rates, releasing MEIS and SEIS rates, extending Interest Equalisation Benefits and providing non fiscal facilitation.

FIEO President thanked RBI for concurring with FIEO’s suggestion and expanding the coverage of borrowers under the Resolution Framework 2.0 scheme by enhancing the maximum aggregate exposure threshold from ₹25 crore to ₹50 crore for MSMEs, non-MSME small businesses.

FIEO Chief however, urged RBI and Government to extend an additional 10% credit facility, as made available under ECLGS 1.0 to ECLGS 2.0 also for the benefit of MSME units besides others.

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