The Hindu Business Line : Monetary tightening measures should be eased: CII

New Delhi, July 29 In the wake of inflation moderating, the Confederation of Indian Industry has suggested that the monetary tightening measures introduced earlier by the RBI to contain inflation be eased.

Non- food credit

The non-food credit offtake during the period March 31 and May 25 reduced significantly.

The non-food credit outstanding during this period declined by more than two per cent to Rs 18,41,656 crore as on May 25.

Total bank credit

The total bank credit also registered a similar downward movement.

Such a trend is a major cause for concern on economic expansion and would have a downward impact on economic growth, according to the chamber.

The decline in non-food credit offtake has been due to monetary tightening measures introduced in the recent past by the apex bank.

As a result, interest rates have gone upwards.

Prime lending rates

The prime lending rates have gone up from 12 per cent in first week of February to 13.5 per cent in the first week of April and any further upward movement in interest rates would slow down the investment rate in the productive sectors of the economy, according to the chamber.

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