RBI cuts bank rate to 10 p. c.

The RBI today cut the bank rate by one percentage point from 11 per cent to 10 per cent per annum, firmly banking on a cheap money policy to stimulate growth. Simultaneously, the interest rates on deposits of maturity of 30 days and up to one year have dropped from nine per cent to eight per cent. All interest rates on advances from the RBI such as export credit refinance and general refinance to banks which are specifically linked to the bank rate will stand pruned by one percentage point. Interest rates on post-shipment rupee export credit have also been marked down. Effective June 26, the interest rate on post-shipment rupee export credit on demand bills for the transit period and on usance bills for the total period up to 90 days comes down to 12 per cent from 13 per cent and that on usance bills for total period beyond 90 days and up to six months from the date of shipment stands reduced to 14 per cent from 15 per cent.

Private airlines may get international routes

As part of its exercise to thrash-out a comprehensive Civil Aviation Policy, the Civil Aviation Ministry is toying with the idea of progressively permitting scheduled domestic carriers to fly on international routes so that the Indian presence is maintained in all important markets. Private airlines have for long been seeking permission to operate on international routes. The Ministry has, however, been denying them clearance, influenced by the stand taken by the national carriers on this Issue. But even as Ministry officials seek to put together an aviation policy which tackles both the subjects of airlines and airports, the issue of allowing private airlines to compete with the national carriers on international routes has surfaced again.

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