Dr D K Aggarwal, President, PHD Chamber of Commerce and Industry has urged the RBI for a significant cut of 50 basis points in policy repo rate in the forthcoming Fifth Bi-monthly Monetary Policy Statement, 2019-20 scheduled on December 5, 2019 to induce demand and revive economic growth as the GDP growth of the country has decelerated to the level of 4.5% in Q2 FY2019-20.
Economic slowdown requires an immediate push to enhance the sentiments of businesses with reduced costs of capital, said Dr Aggarwal.
The reduction in repo rate will support the liquidity in the economy and easier access of credit to the industry, especially to the MSMEs, said Dr D K Aggarwal.
Simultaneously, Dr Aggarwal has urged the banking sector for the full transmission of the cut in policy repo rate undertaken by the RBI in the recent quarters to percolate the benefits at the ground level
Easy availability of money at this juncture becomes crucial to enhance the domestic demand which is one of the major reasons of slowdown in the economy, said Dr Aggarwal.
The easy availability of money with lower interest rates will not only enhance the sentiments of businesses but also create opportunities for workforce to find jobs in the sectors such as housing and construction, automobile, FMCGs, among others which are impacted by the slowdown, said Dr Aggarwal.
We believe that higher industrial growth vis-a-vis strong demand scenario coupled with speedy implementation of reforms and ease of doing business will refuel our economic growth trajectory, said Dr. Aggarwal.