The final decision would be taken by the Government shortly. Currently, theRBI was working out a legislation for NBFCs, he said. Under the new lawthere will be a a regulatory authority for the NBFCs.

Dayal pointed out that, the report on NBFCs prepared by CM Vasudev hadunderlined the need for a separate regulator for NBFCs.

The Government, he added, was also gearing up to introduce the changes inthe Debt Recovery Tribunal Act in Parliament in the winter session.

Speaking at the conference, chief economic advisor Shankar Acharya saidinterest rates were unlikely to come down as long as Government continued toborrow huge funds from the market.

Fiscal deficit would have to be brought down for interest rates to soften,he added.

However, the prime lending rate (PLR) of banks have come down substantiallysince the early 1990s from 19 per cent to about 12-13 per cent, he said. Onreducing deposit rates to bring down lending rates, he said any reduction indeposit rates would see funds flowing into other channels as the investorhad many options now.

"Controlling interest rates by Government will see flow of funds into otherchannels and the lendable resources with the banks would come down," headded. Dismissing suggestions that inflation rates have come down due torecession in the manufacturing sector, Acharya said prices have come downdue to better supply-side management and transparent import policy.