A Fresh Thrust To Growth

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: The RBI’s annual policy for 2004-05 has given a fresh thrust to growth and development with its focus on infrastructure, hospitals, education, agriculture, small and medium-sized enterprises (SMEs) and rural development. The measures to encourage priority sector lending and accelerate the flow of credit to micro-finance will give a boost to priority sector lending.

The focus on long-term financing will help strengthen infrastructure lending.

Credit delivery at the grassroots is sought to be strengthened through micro-credit, indirect agriculture lending, lending SMEs, re-structuring co-operative banks, etc. Extension of CDR mechanism to SME customers as well as focus on credit delivery will help banks expand the scope of their lending activities.

Overall, the policy has sent out a clear signal for expanding growth and development, with thrust to priority sector lending.

At the same time, RBI has focused on the safety and soundness of banks with improved risk management and international best practices.