by Apparel Resources News-Desk
07-August-2019 | 1 min read
Small but important support for the industry!
In its third bimonthly Monetary Policy for the year 2019-20, Reserve Bank of India (RBI) has reduced the repo rate (the rate at which it lends to banks) by 35 basis points from 5.75 per cent to 5.4 per cent with immediate effect.
Shakthikanta Das, Governor, RBI today announced the decision of Monetary Policy Committee to maintain the accommodative stance of monetary policy.
Apparel industry has welcomed this decision as it will support the growth of the industry. However, they have their apprehension too.
“Banks have reduced their Weighted Average Lending Rates (WALRs) on fresh rupee loans only by 0.29 per cent during the current easing phase so far (February-June 2019), when RBI reduced the REPO rates by 0.75 per cent during this period. Despite the meetings RBI Governor had with banks, asking them to transmit the reduction, only one or two banks reduced their rates,” said Raja M. Shanmugham, President, Tirupur Exporters Association (TEA).
He further hopes that by taking into account the requirement of industry, all banks will come forward to pass on the reduction of interest rate to the borrowing units, which is desperately required for the garment exporting units, particularly to MSME exporting units which are suffering further to macroeconomic changes.
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