Financial Daily from THE HINDU group of publications
Thursday, Oct 27, 2005
Financial Daily from THE HINDU group of publications Thursday, Oct 27, 2005 |
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Money & Banking
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Credit Policy Industry & Economy - Exports & Imports Boost to textile exports, says FIEO Our Bureau
New Delhi , Oct 26 THE Federation of Indian Export Organisations (FIEO) has welcomed the Mid-Term Review of the Credit policy by the Reserve Bank of India. According to the FIEO, the Review would provide great impetus for export of textile products as it proposed to allow banks to issue guarantee or stand-by letter of credit in respect of external commercial borrowings raised by textile companies for modernisation and expansion. According to the FIEO President, Mr O.P. Garg, textiles export was affected by lack of FDI and the RBI move would help bridge the gap. The FIEO is of the opinion that the exporters should be exempted from ECGC (Export Credit Guarantee Corporation) cover of pre-shipment credit and it should be left to the notified banks, if they so desired, to cover the risks.
Our Mumbai Bureau reports: The Indian Merchants Chamber has welcomed the Credit Policy Review, stating that it responded to the overall macro-economic policy concerns and struck a fine balance between growth and inflation. Mr Rajesh Kapadia, President of IMC, said the policy — by not raising actual interest rates but giving an indication that there may be some monetary tightening— has supported the current growth momentum of the economy. Considering that the RBI faced a delicate job of finding a balance between taming inflationary expectations and sustaining the economic growth at above 7 per cent, the IMC feels that the policy is largely in tune with expectations. The RBI could have given a push to further liberalising capital account convertibility to enable provide corporates a more facilitative environment in going global, it added.
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