Pitching for interest rate cut a day ahead of the monetary policy review by the Reserve Bank of India (RBI), finance minister Arun Jaitley on Monday said high rates could make the economy sluggish.
As far as the interest rates are concerned, the movement in the last one year has been downwards, he noted. “The government has stuck to fiscal commitment and inflation has been under control. Therefore, I do hope that this movement will continue in order to make our economy more competitive with more competitive interest rates,” Jaitley said, addressing the annual session of the Confederation of Indian Industry (CII).
With the central bank’s primary preconditions of fiscal consolidation and easing of inflationary pressures being met, many analysts expect the RBI to administer a 25 basis point cut in the benchmark repurchase rate to 6.5% in its first bimonthly monetary policy review for 2016-17 on Tuesday.
Separately, Jaitley slammed Delhi CM Arvind Kejriwal for criticising the Centre’s decision to levy excise duty on jewellery.