Mumbai, Dec 6 (IANS) Following are the highlights of a growth stimulus package unveiled by Reserve Bank of India (RBI) Governor D. Subbarao here Saturday in a bid to cushion the impact of global slowdown on the country's economy:
- Repo rate cut by 100 basis points to 6.5 percent
- Reverse repo rate cut by 100 basis points to 5 percent
- No changes in cash reserve ratio and statutory liquidity ratio
- Refinance of Rs.7,000 crore (Rs.70 billion/$1.4 billion) for Small Industries Development Bank of India
- Refinance of Rs.4,000 crore (Rs.40 billion/$800 million) for National Housing Bank
- Housing loans under Rs.2 million classified under priority sector
- Exceptional treatment to commercial real estate exposures
- Restructuring by banks eligible for exceptional regulatory treatment
- Measures should step up demand and arrest the growth moderation
- Net liquidity since September enhanced by Rs.300,000 crore (Rs.3,000 billion/$60 billion)
- Difficult to precisely anticipate every development of global crisis
- Recession will be deeper, recovery longer than earlier anticipated
- Period of painful adjustment for Indian economy inevitable
- Fundamentals of Indian economy continue to be strong
- Economists predicting the worst global recession since the 1970s
- Confidence in global credit markets continues to be low
- Credit lines remain clogged
- India's exports declined in October for first time in seven years
- Demand for bank credit slackening, despite comfortable liquidity
- But inflation, based on wholesale prices, declining
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