Experts on Friday said the Reserve Bank of India’s (RBI) decision to keep the interest rate unchanged, along with announcement of additional measures including on the liquidity front, is expected to revive economic growth.
The RBI left the repo rate unchanged at 4 per cent and reiterated its commitment to keep its monetary policy accommodative, to help the economy recover from the world’s worst outbreak of Covid-19.
It also allowed banks to borrow as much as ` 15,000 crore for lending to Covid-19-hit sectors such as the hotels and tourism industry. Further, an additional `16,000 crore funding has been earmarked for SIDBI for lending to micro, small and medium enterprises.
Veena Sivaramakrishnan, partner at Shardul Amarchand Mangaldas & Co, said extending `15,000 crore coverage to contact-intensive sector on a medium-term basis for 3 years was the need of the hour and seems to have been addressed.