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Mr Haseeb A. Drabu

Mr Haseeb Drabu, Chairman of Jammu and Kashmir Bank, states that they do not see any major impact of RBI measures on inflation.

They do not anticipate another rate hike in the next few months. Mr Drabu comments that the impact of RBI's moves would be visible in two months.

According to them, the retail boom could see a slowdown. However, they do not see a major slowdown in GDP.

Excerpts of CNBC-TV18's exclusive interview with Mr Haseeb Drabu:

What is your sense of what the RBI has been doing and how will all end for the economy?

I would break up the policy measures of the Reserve Bank over the last eight months into two parts. Part one, I would see in terms of whether it was changing the liquidity position or hiking the interest rates.

The first part of it was related to compulsions of a sectoral kind, which were the banking sector. The RBI was concerned about the credit offtake, the quality of credit, its sectoral composition so on and so forth, which is the first part which was still about December-January this year.

Starting February and March, we have got into the second phase of RBI interventions, which are not sectoral in motivation but are macro-economic in its motive. So part two of the RBI interventions are related more to the macro-economic situations, emerging macro economic situations rather than banking sector per se.

As far as the first part of it went, the RBI did not quite succeed as much as it thought it would, either in slowing down credit or radically altering the composition of credit. Because even as late as Q3, real estate lending was still high, credit had not slowed down to the extent RBI wanted. So it was a mixed bag there.

As far as the second phase is concerned, I think it is more of being seen to be doing something rather than doing something which will actually have an impact directly and in the short run.

The impact will pan out over the next two quarters, perhaps, but I am not so sure as to whether it will be able to sustain growth and contain inflation at the same time, which is an ideal case scenario. I would reckon that both will not be impacted as much, but I do not see RBI's measures having a huge impact on inflation either.

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