According to a recent press report, Tamil Nadu Chamber of Commerce and Industry has said that the Reserve Bank of India’s decision to increase the repo rate by 25 basis points will affect the common man and hold back industrial growth and investment in the country.
According to Mr. N. Jegatheesan, President of the Chamber said that the hike will pull back the momentum of industrial growth in the country and accentuate the woes of common man because all types of loans will become costlier.
He also said that the hike is another burden along with the rise in petrol prices. He said that the rate has been hiked 12 times since March 2010, on a regular intervals and the reason for the hike was said to control the growing inflation.
The continuous hike has resulted in an increase in lending rates by banks and reduced money circulation, much to the chagrin and discomfiture of trade, industry and the general public. Mr. N. Jegatheesan also said that it has neither caused significant impact on inflationary trend. He said that in order to control inflation and leverage growth, it is very important for the government to address the several constraints faced by many industrial segments.