RBI working on scheme for cheap loans for consumer goods: Rajan
Raipur: RBI Governor Raghuram Rajan on Friday said the central bank is working on the contours of the scheme that will provide cheap loans to buyers of consumer goods.
"I just want to emphasise that discussion is taking place on what can be done. Something will be announced as and when the scheme will be put together," he said while addressing a press conference after the Reserve Bank board meeting.
On Thursday, after a long meeting of Finance Minister P Chidambaram with Rajan and Economic Affairs Secretary Arvind Mayaram it was announced that PSU banks would be provided additional capital infusion over and above Rs 14,000 crore announced in the Budget, 2013-14.
"This (capital infusion) amount will be enhanced sufficiently. The additional amount of capital will be provided to banks to enable them to lend to borrowers in selected sector such as two-wheeler, consumer durables, etc at lower rates in order to stimulate demand," a Finance Ministry statement had said.
The decision is aimed at stimulating demand for consumer goods and promoting growth rate which had slipped to decade's low of 5 percent in 2012-13. In the first quarter of the current fiscal, it was 4.4 percent.
Chidambaram had also said that he would meet heads of PSU banks soon to impress upon them the need to lower interest rates for select sectors.
As per the latest industrial output data, the output of the consumer durables sector declined by 9.3 percent in July, compared to growth of 0.8 percent in the same month last year. The segment saw 12 percent decline in output during April-July compared with growth of 6.1 percent.
Consumer durables, a reflection of demand for manufactured products, include TVs, fridges, washing machines.
Besides, two-wheeler sales recorded a flat growth rate of 0.72 percent in April-August period current fiscal, as against a growth of 6.8 percent in the corresponding period last year.