The Hindu Business Line : TEA draws comfort from unchanged interest rates in RBI's credit policy

Money & Banking - Credit Policy
Industry & Economy - Knitwear & Hosiery
States - Tamil Nadu
TEA draws comfort from unchanged interest rates in RBI's credit policy

Our Bureau

Coimbatore , Oct. 31

Tirupur Exporters Association (TEA) has drawn comfort at the status quo maintained by the RBI on bank/reverse repo rates and the cash reserve ratio in its mid-term review of its annual policy announced on Monday, despite the .25 per cent hike effected by the Central bank in the repo rate.

Reacting to the RBI's mid-term review, the TEA President, Mr A. Sakthivel, hoped the rise in the repo rate would not lead to any hike in the interest rates from the banks. The 8 per cent GDP projected by the RBI for the 2006-07 indicated that the economic measures initiated earlier helped the growth momentum.

The TEA felt the RBI's new initiatives in allowing importers to book forward contracts for their customs duty components in imports and the enhancement in the eligibility limit for forward contract cover for exporters and importers in excess of 50 per cent (against earlier 25 per cement limit) would support the exporters/importers in handling the exchange fluctuation. Mr Sakthivel felt that some of the measures initiated under the policy review would go to support for full capital account convertibility in near future.

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