The Hindu Business Line : ‘The second stimulus package is general in nature’

Madurai, Jan. 5 The Centre’s second stimulus package is proactive and efficacious but stimulants are needed for small and medium industries and agricultural, the Tamilnadu Chamber of Commerce and Industry said.

The announced measures are general in nature, the chamber said. But specific incentives are required for the small and medium industries sector and stimulants to spur agricultural growth to enable farmers avoid wastage and sell their products at viable prices.

In a statement released here, the chamber senior president, Mr S. Rethinavelu, said the additional funds of Rs 20,000 crore made available through a cut in the repo rates and cash reserve ratio, instead of being invested in Government bonds, should be offered by banks as credit at cheaper rates to trade and industry to ensure that the benefits of the fiscal incentives reached the public.

Banks should lay more emphasis on extending banking services than function with profit motives, he urged.

The allowance to the States to raise in the current financial year an additional market borrowing of 0.5 per cent of their gross domestic product to the tune of Rs 30,000 crore through tax-free bonds, admitting non-banking finance companies dealing exclusively with infrastructure financing to access external borrowing would activate infrastructures, essential to accelerate trade and industrial growth.

Importance given to home loan sector and integrated townships in the final incentive package for 2008-09 would induce construction of more houses, he added.

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