CII calls for monetary stimulus to revive growth

HYDERABAD: Concerned with sluggish economic growth, the Confederation of Indian Industry (CII) today said that it is time the Reserve Bank of India provide monetary stimulus by cutting CRR and Repo rate by 100 basis points.

The industry body in its ten-point Economic Revival Package submitted to the government has also suggested that the FDI limits should be increased in civil aviation and defence besides allowing multi-brand retail, CII President Adi Godrej said at a press conference here.

"We think the monitory policy is to be revised. Already, in early April we saw reduction in repo rate. We need further reduction, both in repo rate and CRR by 100 basis points," Godrej said.

"Fortunately, inflationary expectation are coming down. Global commodity prices, particularly crude, are falling. This is the right time to create monitory stimulus that can revive the economy," he observed.

He added that corporate profits have also been declining and the government should take corrective measures before things worsen.

The country's GDP growth for 2011-12 was pegged at 6.5 per cent and during the fourth quarter, it was down to only 5.3 per cent, raising concerns among the industry and government.