NEWS & ADVICE : PERSONAL LOAN
Indian industry demand for reduction in interest rates
By Vaibhav Aggarwal
May 14, 2009
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Following the latest index of industrial production data that reveals fall in industrial production and fading consumer demand, Indian industry demands for lower interest rates, increased credit flow by banks and higher investments in infrastructure.

FICCI President, Mr Harsh Pati Singhania said, "Lending rates continue to remain fairly high and act as a disincentive for fresh investments and fructification of planned projects. We hope that the effective lending rates of banks would come down further keeping in line with the policy rate cuts already announced by the RBI. This would push investments and bring the consumer back to the market."

Other the other hand, PHD at Chambers of Commerce and Industry suggested that, "Ensuring adequate credit availability to industry at reasonable rates is a priority to boost demand and reduce production costs in industry. Rationalisation of taxes and a special incentive package for sectors worst affected by the slowdown is also necessary to stimulate demand."

However the Associated Chambers of Commerce has intimated that there is not going to be any recovery during the next 2-3 months. "Industrial production will continue to contract at least for another 2-3months though signs of recovery have started discreetly surfacing but their results will be visible by June onwards. Until then, Indian Inc will have to cope with realities of ongoing' meltdown," said Mr Sajjan Jindal, Assocham President.

Further the industry people insisted on more concession on the tax front in order counter the falling industrial output.

The industrial output declined by 2.3% in the month of March.

 


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