Business EconomPosted at: Jun 4 2021 4:37PM ICC appreciates RBI’s decision to step up its efforts to ensure liquidity in system with another G-SAP worth Rs. 1.2 lakh Cr
Kolkata, Jun 4 (UNI) Indian Chamber of Commerce (ICC) on Friday highly appreciated Reserve
Bank of India's decision to step up its efforts to ensure liquidity in the system with another G-SAP
worth Rs. 1.2 lakh crore planned for this fiscal year.
In addition to that, RBI has kept the repo rate unchanged at 4 per cent. Which, ICC feels shall
further help home buyers. As prevailing low home loan rates are already enticing for homebuyers,
with inflation set to be high and economic recovery slow due to surge of Covid, residential real
estate will continue to attract investment as it is a safe-haven asset.
As an industry body, we highly appreciate Central Bank’s decision to increase the maximum
aggregate exposure threshold under the resolution framework 2.0. As a result, individual and
MSME borrowers’ loan (up to Rs 50 crore) can be able to opt for restructuring, Dr. Rajeev
Singh, Director General, Indian Chamber of Commerce (ICC) said.
The Reserve Bank of India will also purchase the remaining Rs. 40,000 crore worth of
government securities under the G-SAP 1.0 on June 17. In this, Rs. 10,000 crore would
constitute purchase of State Development Loans (SDLs).The inclusion of SDL on G-SAP
would support state government borrowings from the market. Considering increasing debt
burden of the States, this policy measure will be really effective.
RBI said that it will open a special liquidity window of Rs. 15,000 crore till March 30, 2022,
with tenors of up to 3 years at the repo rate. Under this banks can provide lending support to
hotels, restaurants, travel firms, aviation ancillary services and other services that include
private bus operators, car repair services, spa, and saloons. As an industry body, ICC highly appreciates this decision. It would go a long way in supporting cash strapped Hospitality
industry.
"We also feel that the announcement of G-SAP 2.0 to the tune of Rs. 1.2 lakh crores will
ensure adequate liquidity in the system. Upward revision of inflation rate will raise bond
yields marginally in the short run," Dr Singh added.
UNI BM