He is really trying to destroy the India story! There maybe many reasons for not curring the rate ... but there are quite a few compelling ones in its favour too! - Interest rate is too high for investment cycle to start - oil prices have come down drastically... precious time is lost to take advantage of this. - China has cut rate 4 times from 7% to 4% in the last 1 year! Something must be right about the environment to cut rate... we just cant say china and India are different! - High rate chokes supply... for example if no roads, less easy to meet demands, hence less supply. Counterproductive to inflation. - It creates less jobs.. in fact companies like Essar, Lanco, Suzlon, etc. many others are reeling under the impact and want to sack people. What happens to the society.
Hence I am inclined to conclude that Raghu Rajan is an agent of Fonia, sole intention... put down NDA govt. -
Re: Raghu Rajan has forced modi to go on backfoot
by Solomon S on Apr 10, 2015 07:01 AM
He simply ignores the side effects in the society, - Adds pressure on the Industry which is already seeing a dead-end on the growth - Adds pressure on the consumers spending budget since increase in wage is directly proportional to Industrial growth - Banks stops lending/doing too much of over protection due to increase in NPA, this is evident from the recent comments from both NaMo and Raghuram - People becomes jobless which causes increase in robbery in many forms which will lead to social unrest if continued this way
It is time for focusing on growth in all means instead of controlling inflation numbers only higher rate which is no where helped to reduce the commodity/food prices which are already rocket high
Re: Re: Raghu Rajan has forced modi to go on backfoot
by SureshKumar CV on Apr 10, 2015 02:06 PM
8Prices are high because of short supply. Short supply of particularly agricultural produce is mainly attributable to not sticking to proper methods. Instead of increasing agricultural produce, people have been found doing something different and that yielded no positive result... right from the time of previous government (I guess now over 10 years) So, keeping high interest rates are not going to help in any manner rather than playing spoil-sport.
And if the interest rates are brought down, then just for the sake of supporting the government, people would say that senior citizens, etc., who mostly depend on returns on investments like bank deposits, etc., have been ignored as lower interest rates bring down their income as well.
So, there may be various reasons behind such decisions. But instead of finding the root cause, we find that people have been approaching to things in a shortsighted manner and that is the reason for this mess I guess.
If you dont know just shut your mouth and do nothing. This is better than saying something & exposing yourself. RR has taken the right decision of not cutting the rate just for the heck of it. He is waiting for US Fed rate hike decision to ensure impact on rupee is minimum. The schedule banks are goons & tries a lot to bully him to get loans at cheaper rate from RBI and will not pass on the same to end customer. But they are good in giving away money to defaulters and there is no visible action towards containing NPAs. Even the bank employees shouted before an MNC in chennai to draw attention regarding the outstanding to be collected. No result as such. Why rate cut? Just to give it to corporate and forget it?
Re: Ravi Raj just foget abt writing
by rakesh goyal on Apr 08, 2015 02:24 PM
It is not the case of one rate cut by RBI, banks in general for last few instances of rate cuts have boosted their income by giving loans to new customers only at lower new rates and simply forget extending the benefit of reduction in REPO rate to the existing ones who are already paying a higher rate of interest on the loans they have taken. giving the reason that their rate of interest will be coming down when base rate is reduced by the bank. Hope this time banks will banks get enough wisdom to give the benefit to the loyal old customers also. If now also this does not happen then one can say for sure that RR has a very valid reason for not reducing REPO rate for the benefit of bankers.