Commerce Minister pitches for rate cut to boost growth
New Delhi: With inflation easing marginally to 7.25 percent in June, Commerce and Industry Minister Anand Sharma Monday pitched for cut in interest rate by RBI in its month-end policy review to boost both growth and exports.
"The cost of the credit has to be low so that the Indian industry remains competitive in the global context," Sharma said here.
"I have always been an advocate of creating an environment where industry, the private sector, invest more," he said.
The Reserve Bank of India (RBI) has a duty to do, he said, adding the government has to ensure that the economic activity remains dynamic.
"Though there are certain measures which are required when it comes to liquidity and its impact on inflation. We cannot starve the industry or bring investments down which has a huge social dimension particularly on employment creation and sustaining jobs," he said.
Inflation declined to 7.25 percent in June as against 7.55 percent in the previous month.
Overall food inflation rose to 10.81 percent in June, from 10.74 percent in May. In June last year, inflation rate in this category was 7.6 percent. Food articles have 14.3 percent share in the WPI basket.
In the manufactured items category, prices of cotton textile, rubber and plastic products, iron and machinery eased a little year-on-year basis.
The rate of price rise in the manufactured products was 5 percent in June, as against 7.9 percent in the same month last year. In May this year, it was 5.02 percent.