The Confederation of All India Traders (CAT) welcomed the various announcements made today by the Governor of the Reserve Bank, Shri Shaktikanta Das, saying that in the present crisis of Corona, these announcements would benefit not only traders but also other people of the country and will relive the people from the great burden of financial liabilities for the present. This step of the Central Government is another major step in the chain of giving concessions to various sections amid circumstances created due to COVID-19.
CAIT National President Mr. BC Bhartia and Secretary General Mr. Praveen Khandelwal welcomed the RBI announcements saying that keeping aside inflation, the Reserve Bank has taken major steps to strengthen the economy which will provide great relief in this present crisis.. The RBI has taken a big and bold step. India’s Debt to FDP ratio is very low as compared to other countries.
RBI has infused massive liquidity in the market which is nearly 3.2% of GDP. Now, it is the turn of Banks to demonstrate bold & strong leadership. The Banks should go ahead for liberal lending. The Banks will have to compete with NBFCs in lending. There may be some cases of financial strictness but lending should be viewed liberally for economic upliftment. At this crucial juncture pumping of liquidity in the market is all the more necessary.
Both trade leaders said that with the reduction of CRR, the interest rates will be reduced. Banks will have lot of money and they will be able to increase the liquidity of money. Accordingly, the Banks should be prepared to give loans to more and more people, and the said money will rotate in the market and increase liquidity in the market!
Mr. Bhartia and Mr. Khandelwal said that the reverse repo rate has been reduced drastically. This means that the bank will now increase the debt in the market instead of holding money in the Reserve Bank. Whether a term loan, cash credit, or overdraft limit, the interest charged above all has been postponed for 3 months. This is a very big step which will help the traders a lot!
Both Mr. Bhartia & Mr. Khandelwal said that the postponement of all bank loans, EMIs and interest will provide new business opportunities to the country’s trade and small scale industries and domestic business will increase, while the working capital has been asked to rework. This means that if we want additional money, we can go to the bank, we can keep our demand. . By increasing the housing loan also, the general public will also get money and the market will accelerate.
Along with this, suggestions have been made to increase the liquidity of the money in the market, it will bring more money of Rs 3.74 lakh crore in the market and after the finance minister gave a package of 1.70 lakh crore yesterday, the flow of about Rs.5.5 lakh crore in the market can be seen in future. Another factor that no accounts of traders will become NPA is also a major relief. Overall, the government has not left any stone unturned to help in assisting trade, industry and small scale industries during this time of crisis!
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