The Hindu Business Line : Industry seeks more CRR cuts

To infuse sufficient liquidity and boost demand in a slowing economy, industry chambers like the FICCI(Federation of Indian Chambers of Commerce and Industry) and CII (Confederation of Indian Industries) have sought further reduction in the Cash Reserve Ratio (CRR) by 100 basis points. FICCI has asked for a cut in repo rates by 150 basis points over the next three months.

It also suggested easing FII inflows by easing the registration norms, re-looking the PN policy and increasing further the limit on investments in the corporate debt market. "The current situation demands about Rs one lakh crore of liquidity to be pumped in and, therefore, the CRR should be accompanied by other measures such as immediate unwinding of the market stabilisation scheme bonds held by RBI," the CII suggested in a statement. It also said that as inflation figures showed signs of softening, the time was appropriate for RBI to revise rates. Industry chambers have sought relaxation of external commercial borrowing guidelines for all companies investing in new capacities. - Our Bureau

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