Letters to the editor

Published: April 5, 2016 1:23 AM

Clamour for a rate cut

Clamour for a rate cut

RBI has recently advised all SCBs to replace their base rates with Marginal cost of funds based lending rate (MCLR) with effect from April 1, 2016 and set lending rates on loans and advances with reference to the MCLR of bank. The Union Budget 2016 was out recently and the government outlined its comprehensive action plan which looks more committed to the path of fiscal consolidation. In an attempt to quell inflation, the growth has been taking a backseat. The pressure is building up for a rate cut to boost investment and prop up growth. All these factors should hopefully lend comfort and also clarity to RBI for a further rate cut, sooner than later. A cut in the key policy repo rate by 25 bps is an obvious thing to expect. But, the RBI governor has a knack for surprising markets, there should be no surprise if the RBI looks beyond to cut the rate even by 50 bps.

Srinivasan Umashankar

Nagpur

Dont budge to tobacco

A little modification to make availalable space from the present 40% to 85% for pictorial warnings on cigarette packs has evoked strong protest from tobacco manufacturing companies leading to closure of factories from April 1. The campaign against tobacco use has gained momentum in the light of more and more people getting affected consequent to its use on larger scale. Our neighbouring countries like Nepal, Thailand, Pakistan, Sri Lanka and Myanmar have acknowledged that larger warning is mandatory. It has been estimated that over one million deaths per annum are occuring due to tobacco use and the cost to the national health is an estimated R1 lakh crore per annum. The government should not budge if the strike by cigarette manufacturers continues.

KV Seetharamaiah

Hassan, Karnataka

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