The Hindu Business Line : Cut prices

While India Inc demands interest rate cuts, the Government and the RBI usually respond quickly, without too much thought about the investors and savers, who are likely to get lower interest on their deposits from the banks.

The industry must immediately reduce real estate prices, and the prices of motor vehicles, two-wheelers and the like, and substantially.

If it does not heed the advice, the Government/the RBI should not respond to the demands of industry. Every 1 per cent reduction in interest rate should be commensurate with the reduction in prices of at least 10-15 per cent.

In addition, various segments of industry must also respond to the earlier advice of the Prime Minister to reduce executive salary.

K. Vittal Shetty Bangalore

Increase production

The call by the Finance Minister, Mr P. Chidambaram, to industrialists to cut prices, not production, is a well-meaning step but it should be coupled with easy credit also, as a cash crunch could have severe impact on industry, resulting in reduction of jobs.

The Government’s move to deploy Rs 50,000 crore on infrastructure needs a re-look as the need of the hour is a jump in production in agriculture and related sectors and general industries as a shortage of commodities will cause a further rise in prices, affecting those out of jobs and suffering salary cuts.

The idea of identifying projects to raise public expenditure by the Plan panel is good, but the above points should be borne in mind too.

T. R. Anandan Chennai

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