The Hindu Business Line : Assocham urges RBI to roll back CRR hike

The Associated Chambers of Commerce and Industry of India (Assocham) has asked the Reserve Bank of India to roll back the cash reserve ratio to the previous level of 4.5 per cent as the liquidity crunch in the market is affecting the industry.

According to the chamber, a series of hikes in the cash reserve ratio from the initial level of 4.5 per cent by the Reserve Bank of India has created liquidity crunch in the money market to the extent that the call rates touched the nine-year high rate of 19 per cent.

"Lack of funds has crippled the working of the industry and may seriously hamper the growth if urgent steps are not taken by the RBI. It should put a halt on the series of increase in CRR. The previous increment should be withdrawn as a measure in the interest of the economy," the Assocham President, Mr Anil K. Agarwal, said.

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