'Just cutting rates will do no good'
We asked our readers if they would like to see a drop in interest rates in the Reserve Bank of India's Monetary and Credit Policy for the second half of 2002-2003, announced on Tuesday.
While some strongly moot lower interest
rates--on the lines of those prevalent in China--so as to encourage industries and boost the economy, others express dissension over RBI's "mindless pursuit" of low interest regime.
Here, we reproduce some of the responses generated.
Mon Oct 28 18:51:00 2002
Name: vijay shah
Email: vss64@rediffmail.com
Your Views: Looking at the current situation rate cut will effact negatively.
Mon Oct 28 19:17:40 2002
Name: Manjula
Email: manju@iitk.ac.in
Your Views: Dear Sir, if RBI cuts interest rate then it will affect the few variables soon like savings, loan borrowing, aggregate
demand in the economy which further affects the supply side of the economy. At this time we are suffering form stagflation rather than pure inflation or deflation. Lowing interest rate is preferred to generate the employment. For prompt results cutting
interest is better than cutting bank rate which affects goals comparatively slowly. But once interest is changed, its not wise to revise them frequently as people take time to get adjusted with the changed policies. At this time to stimulate demand and
increase employment cutting rate of interest is better than asking to increase the government expenditure for the same purpose
because deficit financing has other severe shortcoming and fear of crowdingout the private investment until unless interest rates
are not kept at the same level which further requirs to increase money supply in one or other form. So for temporary and
prompt results changing interest rate is a good option to go with. RBI should decrease the rate of interest. Manjula, IIT
Kanpur, India.
Mon Oct 28 19:36:23 2002
Name: A.K. PATTABIRAMAN
Email: pattapiak@hotmail.com
Your Views: RBI must stop its mindless and pointless pursuit of low interest regime? Has lower the interest lead to any
increased credit of-take or greater industrial activity? No, an emphatic no. Lower interest affects domestic savings - which is an
important component for mopping up of local resources. It affects pensioners and middle class people who have no other
security net.Forget not, it was the middle class who catapulted the BJP to power. Do not stab your own constituency at its
back. Way back, the BJP Government in Himachal stabbed the Apple Growers - who had supported the BJP - at their back.
At the hustings, the Apple growers of HP saw to it that the BJP was thrown out. Even today, you must think whether BJP can
win a single seat in Delhi?
Mon Oct 28 19:37:41 2002
Name: Amod Kumar Agarwala
Email: amod@pmail.ntu.edu.sg
Your Views: No rate cut forseen. Reason simple: No issue of money supply...more a question of opportunities to invest which
means an issue of money demand.
Mon Oct 28 19:43:26 2002
Name: Hasso
Email: hasso@rediffmail.com
Your Views: The rates are already so low that surving for pensioners is nearly impossible unless he gambles in the stock
markets and learns that all his money has been lost because of some scam and ends his life by commiting suicide.
Mon Oct 28 20:02:30 2002
Name: Sunil K
Email: sunil_k@rediffmail.com
Your Views: Yes, after all to improve our economy and encourage industries, we need to make capital available to our
trade/industry houses at very competitive rates.
Mon Oct 28 20:03:42 2002
Name: C C RAO
Email: cicirao@yahoo.com
Your Views: Basically banking evolved to create an awarness in Public for saving from their earning. Due to changed scnerio in
econmic polciy of the society interest rates(lending) have been bifurcated and this has been grossly misused bu the society and
thus the profitability has effected. Instead of reducing the interest rates on deposits it is better to rationlise the interest rates on
lending keeping the proofitability of the banking Industry at high and alsowith low postioon of Bad debts. It is the high time to
introduce and use latest Technolgy to reduce cost of misc expenditure.
Mon Oct 28 20:11:00 2002
Name: ZIA QUREISHI
Email: pplphl@vsnl.net
Your Views: It should cut interest rates which should in turn lead to a cut in lending rates so that people can borrow at lower
rates so as to make many busesses viable which will lead to an increase in spending on fixed assets and white goods.
Mon Oct 28 20:14:15 2002
Name: b k patel
Email: vss64@rediffmail.com
Your Views: Interest rate should not be cut inthe following circumstances. (1)Since last three yr. int.rate is cut by about by 33%
not a singal item of Price which is basically necessary for life is cut by manufactur cos.e.g life saving medicin.insted of cut in
price the price is increasing by day by day. (2) Unemployment problem is not decrase but incrase though int.rate is cut by about
33%. (3)All the cost saving by cut in interest is gone in increasing in salary & d.A. In last three Yr.salary & D.A. is increasing
by 20 to 30%.Against this why only int.rate is cut ? In mnufactureing Cost, Salary is also effictive factore. (4)Why only int.rate
is cut? Those who are living on interest income there is lot of hardship in the events of int.rate cut like old man, vrs getting
employee, small investor etc. (5)Further int.rate cut there should be cut in Salary & D.A about 30 % of All employees who get
salary about Rs.20000/- & more per month. Govt. has no daring to cut Salary as Law makers & policy makersare Salaried
Person. (6)As there is not a singal Union of Depositors the Govt.take such fool decesion. (7)Resation in all industry/business is
increase though int.rate cut by 30 %.
Mon Oct 28 20:22:30 2002
Name: Ramaswamy
Email: rswamy121@eth.net
Your Views: Interest Rates in India are too high. They must be brought down. In China, intrest rates are just 4%. Only by lowering intrest rates, cost of capital will fall and economy can grow. Also, lower home loan intrest rates will cause a housing
boom and reduce unemployment. But the RBI is led by cowards who dont want to take bold steps. The argument that intrest rates are to be high to help the retired people is Rubbish. For the sake of 10% Retired people and their income , we are
sacrificing the lives of 90% Youngsters who are underemployed/unemployed and have to pay high intrest rates on Home
Loans/Farm Loans/Vehicle Loans
Mon Oct 28 20:51:24 2002
Name: Muralikrishna
Email: nmk_1970@hotmail.com
Your Views: I think jalan should reduce the rates in tandem with the USA & japan. It definitely proves that our monitory policy
is not as roubust and dynamic as other international markets/countries. Regularly we fail to act and keep going with the issues
which impede the growth of the economy.
Mon Oct 28 21:02:37 2002
Name: K.S.S.RAMAN
Email: jmss@vsnl.com
Your Views: respected sirs, Firstly let govt. and all concerned Bank authorities collect atleast 50% of NPAS in psu banks with
hype ordinance and low delivery module. Middle-class and retired persons without pension are in Coma condition by
paralysed govt. missioaries. If RBI cuts further in interst rate on fixed deposits it will certainly make more number of VRS
persons and 45 yrs and above will into net work of Coma grouph.I really pity senior citizens plight. My earnest request is to
pray GOD forHis Blessings. Thanking you, sincerly yours, k.s.s.Raman
Mon Oct 28 21:06:01 2002
Name: thiru
Email: thiru@rediff.net
Your Views: RBI cannot cut interest interest rates if the government stays on course of poor fiscal discipline and needs top
continue borrowing from public savings. However, if the fiscal deficits are controlled, the interests rates will have to fall quite a
ways, along with the value of the indian rupees vs US dollar.
Mon Oct 28 21:30:16 2002
Name: Rajie
Email: rajie@rediffmail.com
Your Views: NO- The intrest rates should not drop. this will onl show that our economy is weak. As we in INDIA can earn
high intrest rate, the same shoud be passed on to the costomers, who are depositing the same. Cut out unnessary staff &
expendeture. The cent. Gover. should only fix say max on production price to be 15 to 20 % on production cost. The
Companys have to then cut on all unnecessay expence & high wages to Directors. It is but an open secret, balance seets shows
that directors/executive Pays wery unprortinat even if the company is at a loss making
Mon Oct 28 21:32:00 2002
Name: Saurabh Sarayan
Email: saurabh_ms@redifmail.com
Your Views: yes..accordin 2 me he shud go for a drop in the interesst rates as the PLR offered by the Indian Central Bank is
still one of the highest in the world and thus there is still scope for rationalisation. If v want 2 compete with the rest of the world,
this step is a must.
Mon Oct 28 21:42:25 2002
Name: Rajie
Email: rajie@rediffmail.com
Your Views: NO- The intrest rates should not drop. this will onl show that our economy is weak. As we in INDIA can earn
high intrest rate, the same shoud be passed on to the costomers, who are depositing the same. Cut out unnessary staff &
expendeture. The cent. Gover. should only fix say max on production price to be 15 to 20 % on production cost. The
Companys have to then cut on all unnecessay expence & high wages to Directors. It is but an open secret, balance seets shows
that directors/executive Pays wery unprortinat even if the company is at a loss making
Mon Oct 28 21:49:11 2002
Name: rao
Email: rao@123.com
Your Views: yes
Mon Oct 28 21:53:58 2002
Name: pankaj joshi
Email: push_31@hotmail.com
Your Views: yes it should drop by 5%
Mon Oct 28 22:14:14 2002
Name: Shah Dharmesh Yogesh
Email: sdharmesh1@rediffmail.com
Your Views: Yes, RBI should cut the Bank Rate considering the burgeoining liability of the Central Government.
Mon Oct 28 22:46:57 2002
Name: v dinesh
Email: vdineshprasad@rediffmail.com
Your Views: the banks should not cut down the interest rates, It is already very low. most of the middle & lower segment
citizens feel that they can survive on the interest, when the interest rate is being reduced it would be a great shock for them and
their future life becomes a question...
Mon Oct 28 22:57:05 2002
Name: Yogesh Thapliyal
Email: yt29@hotmail.com
Your Views: If the countries financial situation demands a cut in interest rates then it has to be done. All our policies should
make business sense. This is going to affect the retired community and other living on interest income a lot. The goverment
should try to bring some bond etc where people can invest on long term deposits at a slightly higher interest rates.
Mon Oct 28 23:25:27 2002
Name: Anil Gupta
Email: anilkngupta@rediffmail.com
Your Views: Looking at the socio-economic condition of any common man living in India, it is most cruel on the part of
authorities to go on Reducing Interest Rates. By reducing interest rates, only the Government and the rich in the country are
benefitted. This policy of Zero or Minimal interest rate is ok in countries which provide unemployment allowance or old age
pension and medical benefits to its jobless /old /sick population. Inspite of substantial reduction in interest rates, the cost of
every consumer item has increased. The financial burden on the common man is not at all reduced . it has increased. Inspite of
reforms in our country for last so many years, we have not been able to achieve trade surplus even once in last 10 years. Trade
deficit has grown year after year. Bottom line of companies has improved drastically and the government is able to spend
magnamiously perquisites of politicians and on salaries of its most inefficient and mostly corrupt employees. What we are trying
to do is not the welfare of the masses but finding ways and means to pamper the Rich and the corrupt /inefficient governing
population of India. Government or the Trade has no feeling for masses.
Mon Oct 28 23:48:36 2002
Name: Punit Pande
Email: punitpande@hotmail.com
Your Views: currently the country has a dangerously low inflation rate, while even the gdp growth rates are insufficient when
compared with other developing asian economies. lowering of interest rates to international levels shall provide the necessary
framework for transfering money from idle savings accounts to investments. this will not only raise the investment levels of
average indian families but also provide more funds for industry and commerce for expansion. this will make indian businesses
competitive in the international market, support agriculture sector with cheaper loans and reduce the dependence of indian mncs
on raising finance in international markets. moreover, for the same interest amount in real terms, individuals and corporations
shall be able to support bigger loans. also, currently the gap between total deposits with nationalised banks and loans given is
sizeable. hence a small amount of money earns to support the interest payout on large amount of deposits. reducing interest
rates would prompt more people to approach banks for loans and thus increase the overall productivity of money with banks. a
possible side-effect of this may be that industries divert more funds towards productivity and efficiency, thereby making us
more competitive internationally. despite our current problems we have come this far. with a few more corrections we could
take a huge leap forward and ride the crest of the development wave of asian economies.
Tue Oct 29 00:05:26 2002
Name: badal
Email: koolsmokey@hotmail.com
Your Views: no the intrest rate must not be lowered already it has got much lower n loking at the exusting market the best way
to earn money is to keep a bulk of cash on intrest.
Tue Oct 29 00:23:31 2002
Name: Avik Mukherjee
Email: mukherjeeavik@rediffmail.com
Your Views: it has been seen in recent times that lowering of the interest rates have failed to jack up the stock markets.on the
face of it,it would be advisable for the RBI to reduce the interest rates further-the pressure is on Dr.Jalan to do exactly
that.however, it is to be remembered that in the recent times,lowering of the interest rates has failed to increase private
investment.what is really required is a concentrated effort from the govt & the private sector to increase their investment & their
investments should be complimentary to each other.thus,we can avoid crowding out of the private investment & increase
investment in the economy as a whole.the banks are already flushed with money.with lowering of the interest rates,banks would
be in a position to further pump liquidity in the system.the question is-is it required? in my opinion, as long as there is no
coordinated action plan & finally effort from the private sector & the govt., lowering of the interest rates would be too futile an
exercise. i invite a healthy debate on this topic. plz feel free to contact me at my email add. mukherjeeavik@rediffmail.com.
thanks & good luck.
Tue Oct 29 00:29:15 2002
Name: m.t.philip
Email: ph329941@emirates.net.ae
Your Views: bank interest rate has gone below expectations which has led expatriates living in gulf countries etc in turmoil as
they were relying on income from interest accured on their small savings for the rest of their life after returning to india
Tue Oct 29 02:01:57 2002
Name: nijagunamurthy basoor
Email: nbasoor@hotmail.com
Your Views: The RBI should cut the interest rates as compared to united states India's interest rates are too high.Eventhough
America is a rich country the interest rates are too low.The economy to get better please lower the interest rates.
Tue Oct 29 02:03:53 2002
Name: manoj
Email: ambi277@rediffmail.com
Your Views: yes RBI should cut intrest rates
Tue Oct 29 03:02:04 2002
Name: amit khanna
Email: amit_neeru1@rediff.com
Your Views: no, in developing economy ,inflation of 5%is healthy,so at present if people r getting 7.5 ie.2.5 %more than
inflation is must in order to make saving attractive, whereas on loan side it can be reduced marginally
Tue Oct 29 03:20:59 2002
Name: v k n
Email: vkni@rediffmail.com
Your Views: interest rate cut may benifit the industry, but what about the savers, they already r starved of investemnt avenues
,and will have to invest more in govt debt like po mip and rbi bonds etc , and will this affect the real inflation n price rise here in
mumbai? not the bogus one declared by the govt -just cutting rates will do no good to turn around the eco u have to deal with
consumer confidence and growing unemployment and huge state govt debt and inefficient corrupt politicians and their sponsor businessmen
Tue Oct 29 04:14:23 2002
Name: J Rengarajan
Email: shobprab@md3.vsnl.net.in
Your Views: Under no circumstance interest should be cut any further. The only thing Mr Jalan seems to know is to cut interest
rate. The economy is in doldrums. Share market in India has crashed . The poor and middle class are suffering terribly. Only a
small band of very rich are benefiting under the current policy.The divide between the poor and rich have widened. Mr Jalan is
no patch on Dr Manmohan Singh. Thank God the current FM Mr Jaswant Singh seems a little more human. Under the
circumstances the best thing the public can hope for is the resignation of Mr Jalan. He seems to have no prescription for the
ailing economy except interest cut. The actual inflation is concealed by cooked up Government statistics. If the inflation is down
why have the Govt employees D.A. going up. Why has not the EPF rate cut. In fact the Governments both at the Centre and
State being the worst offenders constantly increasing controlled prices like petrol, and diesel, railway fare, electricity charge,
bus fare etc. The people have already demonstrated their view of the BJP Govt's economy in the various elections during the
last months.
Tue Oct 29 06:32:45 2002
Name: BSRANA
Email: bsrana31@rediffmail.com
Your Views: Bank rate should be lowered down to boost economy. Industry should be provided loan at a very nominal rate of
interest. Since it has direct bearing on employment. To creat more job and enhance the profitability it is essential. It will also
stop foreign bank to earn profit from our country.Our goods will become very cheap in the international market and we can
earn a substantial amount of foreign currency by increasing our export. It is just like infusing blood into the heart of economy.
Tue Oct 29 06:44:02 2002
Name: Lal
Email: lalchandran@hotmail.com
Your Views: I think the rate need to be cut and what india need is that their people spend more money and create a good and
better spending habbit as is various leading economies of the world. Only by reducing the interest rate can we ascertain this.
Tue Oct 29 06:53:26 2002
Name: Johny
Email: johnysdb@hotmail.com
Your Views: Yes. It should go up. Otherwise who will deposit money in the bank and take the trouble of going to thebank to
get back his money?
Tue Oct 29 07:23:07 2002
Name: kamala c
Email: k_chavali@yahoo.com
Your Views: present interest rates are at low level. but to maintain finacial discipline among the trade or industry the reduction
of int should be by stepwise such as submission of stock statement,inspection of stocks(byan Accountant or banker) and
holding a certificate ,periodical submission of Creditors/Debtors etc as desired by the financial institution. But any reduction on
deposit rate will demoralise the Banking industry, since most of the deposits are from middle income group,or terminal benifits
of senior citizens and it is not from trade or Industry. Even, any reduction in interest on finance the trade or industry is not
passing the benifit to the consumers hence it is my strong opinion/view there need not be any reduction in interest rates.
Tue Oct 29 07:26:18 2002
Name: J.N. Kini
Email: jaykini@bgl.vsnl.net.in
Your Views: Yes, the Bank rate for borrowing should be in the vicinity of 11-12 Percent for general lendingfor business.The
ultimate goal should be 7-9%. Banks must be carrying deposits on which interest upto 13 % are being still paid.Hence it is to
be only expected that lowering of RBI rates now would have only dilutary effect on BLRs.Ofcourse, RBI should lower Rates
now, since it would be only appropriate to dilute the rates over a period of time rather than briskly, keeping the interests of the
Banks in mind. Lower lending rate would have two benefits,(a) higher investments in equity market by public for better return
on investments and (b) larger turnover aimed by industries which would ultimately lower unit prices in the marketand increase
the buying capacities of the public. All the same Banks should not relax norms for qualification for loans since this would lead to
increased NPA.To tackle NPA, individual Bank managements should be given more discretionary powers, who then could
decide which of their customers should be permitted to exit, etc.,
Tue Oct 29 07:40:17 2002
Name: csunni
Email: csunni@sancharnet.in
Your Views: I feel that the banks should not reduce the interest rate any furtheron deposits.It is at rock bottom even at present
Tue Oct 29 07:43:48 2002
Name: James Bond
Email: jamesbond420@hotmail.com
Your Views: Industry is forever crying and will still cry even when interest rates are 0 % !!! They are not being able to deliver
the goods and why should pensioners etc sufeer due to these inefficient, good for nothing industrialists.
Tue Oct 29 07:46:16 2002
Name: VLP
Email: vlprasad@yahoo.com
Your Views: They have to drop a lot further - current inflation rates in India are 2.5-3% - even assuming US inflation rate is
0%, the real interest rate in India is about 2% higher than in the US! This is a great impedient for doing business in India,
compared to the US (we have enough impedients to worry about anyway, why ask for one more!!). However, this cannot and
should not be done in isolation - on just bank rate alone. Interest rates of pension schemes, and other such "assured" rate
schemes should also fall. Infact it is time we had a debate of whether we would be better off with a floating rate on these
schemes. Economically, people are better off with a sound scheme, which they know will stand the test of time, instead of a
scheme where early participants get a lot of return, but this erodes the financial soundness of the scheme. The UTI experience
should have taught us at least one lesson, right? Another point is that over the next 5 years we hope to grow at 8% - which is
possible only by lower interest rates, and planned inflation targeting.
Tue Oct 29 08:42:35 2002
Name: Abhijit Chowdhury
Email: abhichan@rediffmail.com
Your Views: This matter of frequent cutting of bank interest rates has become similar to steady fall of share value of a corporate
in the stock market, rather than a monitoring process of the RBI. If we study the economic situation that had been prevailing in
an advanced country same bank rates were prevailing in that country, we may definitely find that our country's economy would
be worse. So next thing what we will do is start blaming the politicians. If we continue to expect that lower rates will boost our
country's market and also bring foreign investments, then we may be actually day dreaming. On the other hand, in a similar
gesture, finance ministry keeps on burdening the employee class with income tax as the most easy method to bail out deficits.
Hence we must change our pespective and stop fire fighting. With regards. A. Chowdhury.
Tue Oct 29 08:42:46 2002
Name: Binay Srivastava
Email: binayrinki@rediffmail.com
Your Views: Further interest rates should not be cut
Tue Oct 29 08:46:30 2002
Name: Bharat Bhagat
Email: bc_bhagat@yahoo.com
Your Views: Yes, Rate cut is desirable and it will come soon. A huge sum is laying idle and has become NPA. Next unless, it
rotates, officially, idustry would not grow. It must be all in white and accounted money, NOT unaccounted one as with paralal
fund then only it will have positive effects. Than only it will halp rise economic standard and social growth. Other wise it will rule
like 80-20 i.e 80 % of wealth will be with 20% of elite class.
Tue Oct 29 08:47:34 2002
Name: Rajesh K
Email: rajeshk@rediff.com
Your Views: Hi! I am of the view that falling interest rates would mean lesser returns for investors esp in fixed deposit schemes
(retired employees). So they will hold it rather than invest. Now the rates have declined and it is stable. The "most wanted"
Housing / Infrastructure loan schemes are on Top of charts now. This means the previous cut has taken effect. Also lesser rates
means investments in Tax saving schemes will go down and people will again invest in Land, jewellery etc. To Avoid this the
current rates can prevail for another 2 months. TO prevent loss of investor interests on interests and for the interest of the
investor, I think the interest cuts can be postponed atleast for 2 months time.
Tue Oct 29 08:56:41 2002
Name: C. GOPALAKRISHNAN
Email: c.gopalkrishnan@godrejcp.com
Your Views: Whatever credit sops you give to the industry in terms of reduced interest, the benefits are not percolating to the
consumer. Besides, for retired people the monthly income dwindles year after year and they find it difficult to meet both end
meet. If govt. goes on reducing interest like this, then they should also have some social security schemes for retired old people.
Tue Oct 29 08:59:28 2002
Name: Manjunatha
Email: snail201@hotmail.com
Your Views: Dropping of interest rate without off-take of credit from the industry does not mean anything. There is abundant
amount of credit available for a reasonable good companies at lower rates. However, the economy has to perk up for this
purpose for off -take of credit. Unless this happens, the drop in the interest rate will not lead to any major investment by
industry in producing goods and services.
Tue Oct 29 09:00:27 2002
Name: augustine d'souza
Email: augustine49@rediffmal.com
Your Views: The interest rates should drop for the improvement and development of poor sections in our society. We cannot
afford to pay high interest to only a marginal lucky one's in society. There will be more money circulation for the development of
the nation.
Tue Oct 29 09:01:23 2002
Name: skmehta
Email: mehtas_k@hotmail.com
Your Views: It should not be reduced otherwise where small investor & salaried people go ? As no tight control on share
market also of the government .
Tue Oct 29 09:14:05 2002
Name: Kanhaiya Bhelari
Email: bhelari@yahoo.com
Your Views: lowring of the interest rate will help the poor and medium class people to take loan to start their business and build
a home for them. Let aside the developed countries on the globe, even the China has a minimal interest rate. I think we should
also follow them.
Tue Oct 29 09:17:27 2002
Name: salil
Email: salil@graffiti.net
Your Views: Instead of collecting money within the country for infra structure development, government is making people to
spend in consumer commodities and take loans from other countries. I strongly feel that we should make people to invest in
internal development issues rather than getting money from outside, which will in turn make our debt huge and lead to an
endless loop.
Tue Oct 29 09:27:38 2002
Name: Kiran
Email: k_vootori@rediffmail.com
Your Views: Yes, I think its high time to encourage people to invest money than hand it over to government (deposit in banks)
and leave the rest.
Tue Oct 29 09:31:14 2002
Name: DKK
Email: superdilipk@rediffmail.com
Your Views: 1.The Retail prices are on increase and as such the Interest Rate reduction will lead to hardships for those
dependent on pesions supplimented by interest income. 2.Those who are availing cheap funds are increasing their margins and
are unwilling to pass on the cost reductions to consumers. 3.Govt does not offer any Social Security cover. e.g. Hospitals are
mismanaged and as result the capacity is wasted. 4. The Int Rate decline has been rather rapid than justified.The gradual
corrections should be prefered. 5. The secured source for investment are on decline. Even UTI..?? Not a single was guilty and
hence not punished. 6. FDI is being attracted in terms of finance rather than technology and in non essetial areas
Tue Oct 29 09:34:47 2002
Name: GOD HELP THESE JOKERS
Email: god@god.com
Your Views: these jokers from the industry need an interest cut all the time. why not give them money for free ..so they can
keep there operations as ineffecient as they wish. I seriously feel interest rates shud be brot up so that only serious companies
with strong focus on operations borrow. the others shud wind up and get the hell out of business. Lowering interest rates will
encourage NPAs as ONE will suddenly see the need to borrow. wake up ppl money is not cheap ...u need to work for it .
Tue Oct 29 09:42:03 2002
Name: Ajay Pimpley
Email: ajay.pimpley@schoolnetindia.com
Your Views: Yes In the long run interest rates have to drop
Tue Oct 29 09:44:23 2002
Name: Kamal Bhardwaj
Email: bhardwaj_kamal@rediffmail.com
Your Views: I'm totally against reduction of interest rates whether on Savings or term deposits. The RBI is trying to follow the
footsteps of well established economies like USA but unlike USA India has a large section of population that lies below the
poverty line and a large section of lower middle class. These are the people who invest most on savings and term deposits only
because of the high interest rates the banks used to offer. If bank reduce the rates further, they will have no motivation to invest
in these schemes and thus would loose a safe instrument to increase their income. Lowering the interest rates would only help
the rich class who would get loans on less interest rates. I only hope that the RBI governer will look into this fact before
deciding on this issue. The RBI policies affects the complete society, so it should choose an option that benefits the majority.
Tue Oct 29 09:44:29 2002
Name: Lachman Kotak
Email: lachmank@now-india.com
Your Views: No. We should not reduce interest rates any further. In fact for the aged and retired the rate of interest should be
at least 2-3% higher than for others. Everybody knows what a farce the so called inflation rates are. Also remember that the
govt. is doing this to reduce it's debt servicing burden and not to only facilitate easier access to money for the public. What we
tend to forget is that most of the public money expenditure is decided by people who are not even fit to fill the shoes of a
primary school teacher.
Tue Oct 29 09:48:05 2002
Name: Hamir Asher
Email: hamir_asher@rediffmail.com
Your Views: Reduction in interest rates will no doubt help corporates but it is severely hurting the common man whose good
part of daily expense is being met through interest on FD's, Monthly income schemes and other govt interest schemes. Finance
Ministry chooses to tax everything under the sun affecting the salaried employee the most, since he has no escape route. The
taxes paid are used towards the luxury of the ministers to buy them new cars, furnish houses,personal trips to name a few.
Allow the common to survive with dignity and use other measures to reduce the interest cost of govt and coroprates.
Tue Oct 29 10:01:06 2002
Name: Vivek Dixit
Email: vdvd@rediffmail.com
Your Views: According to the article and Most bankers view about the Bank rate cut. the Governer should implement bank
rate cut immediately and also instruct the bankers to reduce the rate immediately after receiving the notification from him.
Tue Oct 29 10:04:40 2002
Name: Pravin K
Email: pravinmk@indiatimes.com
Your Views: Yes ,Interest rate should be low to Boost economy..
Tue Oct 29 10:08:03 2002
Name: anilshah
Email: anilshah61@rediffmail.com
Your Views: IF THE INTEREST RATES ARE FURTHER CUT, IT WILL BE VERY MUCH DIFFICULT FOR THE
PENSIONERS AND SENIOR CITIZENS DEPENDENT ON INTERST INCOME ON THEIR SAVINGS WILL BE
HARDLY HIT.
Tue Oct 29 10:08:53 2002
Name: Karthik Selvan
Email: karthik_shekar@hotmail.com
Your Views: The RBI should cut the Bank Rate. Inflation rate in India has gone down implying high real rate of interest. With
such high real rate of interest private sector companies would be apprehensive to borrow more for sake of investment. Lack of
investments by private sector could slow down India's GDP growth rate. Although in the short run interest rates may not lower,
in the long run they will when demand for funds will equal the supply of funds.
Tue Oct 29 10:09:45 2002
Name: Himanshu Gautam
Email: himanshugautam@rediffmail.com
Your Views: Yes it is good it should be cut at 0.5 to 1.5 %
Tue Oct 29 10:11:34 2002
Name: RC Seth
Email: rcseth1@rediffmail.com
Your Views: Interest rates should not be cut. It will not lead to saving habits of individuals for which earlier governments have
motivated people of India to save their money for future needs. By cutting the interest rates, their interest in saving will loose.
Tue Oct 29 10:12:43 2002
Name: pranavpal
Email: pranavpal@rediffmail.com
Your Views: sir, lowering /increasing the interest rate has a long bearing on the investment patterns of an economy . we see that
today indian economy is well flourishing . now if the rates are dropped , there 'ld be surplus of rupee as against the dollar , the
RBI has as"foreign exchange reserves ". as a result , we may see a little rapid growth , but finally , with the increase in the value
of the rupee , we 'ld observe a negative impact on the foreign direct investment . it 'll also have a negative impact on the imports
of the country , as indian rupee increases against the "dollar".
Tue Oct 29 10:17:09 2002
Name: Rajeev Gholap
Email: rajgholap@rediffmail.com
Your Views: According to my openion , the intrest rates should not be dropped more, as now there are lot of peoples who
have retired from there service and there are other peoples also who have taken a voulentary retirements, these people are
saved money for there future old age and other domestic reasons such as marriage, study of son/daughter , they are totally
dependednt on the intrest and day by day intrest rates are decreasing and on other hand all other prices are increasing, after
every 4th day price of petrol is increasing, , in this situtaion it is very difficult for a normal or middle class person to servive ,
thus Govt. should also look from this angle and they should not reduce the Intrest Rates.
Tue Oct 29 10:19:39 2002
Name: B.Venkoba Rao
Email: raobvrao@rediffmail.com
Your Views: Bank Rate / Repo rate cut to prop economy - Yes it is to be done. But, cut in Savings rate - No. This will only
increase inefficiencies prevailing in Banks. On one hand they get funds at throw away price and on the other they dole out loans
and go in for OTS - one time settlement which is detrimental to common man. Bankers' need to be on their toes in playing a
narrow spread game. Executive perks - hidden by way of gifts from big borrowers should go which will make Banks more
competitive.
Tue Oct 29 10:21:12 2002
Name: Suraj Raghavan
Email: suraj1raghavan@rediffmail.com
Your Views: The Government Monetary Policy should take into consideration the inflationary trend before going in for Bank
rate cut. With the interest on savings going down so drastically in such a short period the middle class and the retired class have
been affected the most. Hence the RBI interest rate cuts should be monitored very minutely.
Tue Oct 29 10:26:55 2002
Name: Tarun KumarChatterjee
Email: tarun125@hotmail.com
Your Views: Mr. Jalan should not reduce Interest rate till he can assure Social Security for all in India. Else there may be Social
Unrest and even may be unmanageable. Must consult all to introduce any further cut Tarun(Chartered Accountant) Note: We
should not follow USA blindly. We must have our own policy to show the world if we thrive to become as Developed Nation
as President Kalam Called for.
Tue Oct 29 10:32:18 2002
Name: murari daru
Email: m_daru@yahoo.com
Your Views: NO. it already down.think about the people/old peoplewho r all surving on interest income.how they can
survive.day by day cost of living is going up.there is nobody to suport them like european countries thereis not pention provided
by govt.
Tue Oct 29 10:35:46 2002
Name: J .K . ROY
Email: jayanta15@hotmail.com
Your Views: It will be sad if the interest rate is further cut ,it will only embarass the existance of middle clas and service class
population .
Tue Oct 29 10:38:37 2002
Name: Mayur
Email: smanohar@vsnl.com
Your Views: By the policies of RBI and Finance Department, they are determined to remove the middle class. a few to high
class and rest to hell!!!!!!:)
Tue Oct 29 10:48:11 2002
Name: D.C.Chawla
Email: dcsp5@rediffmail.com
Your Views: Only 4-5 years ago retd people could earn 14.5% from fiedxed deposit with Govt agency & 12.5% from the
banks on Fds.Retd people are plenty in number in our country.Lots of them got only PF benefit& no pension.These people
have been becoming poorer each year due reducion of the rate of interest.Govt policies should not be like pendulum of a clock
& extremist type. Now Pl stop further reducing the rates of interest( Pl dont follw U.S.a. policy blindl or tell those retired
people what to do.They are being hit twice 1.Due inflation. 2.Reduction in rates of interest ie their income is going down day by
day. Thanks
Tue Oct 29 10:48:50 2002
Name: mohammed siddik
Email: dmfrepalle@rediffmail.com
Your Views: lack of business source. lack of investment sources for bankers. decrement in profit for all business people.
Tue Oct 29 10:55:33 2002
Name: Neil Pinto
Email: freako2180@rediffmail.com
Your Views: I need higher interest rates in the Savings Sector, so that more people can be lured to save their money.
Tue Oct 29 10:56:27 2002
Name: Pawan Talwar
Email: talwarpawan@rediffmail.com
Your Views: It will adversely affect the common people specially the senior citizens whose daily reqirements are met by the
interest amount only. As if they are already suffering from the earlier interest cuts. Their incomes have become half of what they
used to get in those good days and at the same time the purchasing power of the currency is also decreasing.
Tue Oct 29 10:56:42 2002
Name: mohammed siddik
Email: dmfrepalle@rediffmail.com
Your Views: mostly middle class people depends on interest for their maintenance. NO employment in either government or
private sector. lack of development in agricultural products. more fluctuation in stock market. Small investors are afraid about
investment in stock market. There is no security in stock market. Private banks are offering more interest. But people are not
interesting. Because there is no guarantee for their investments in private, co-operative banks.
Tue Oct 29 10:59:19 2002
Name: U.K.MANDAL
Email: u_mandal@vsnl.net
Your Views: Yes Interest rates should be dropped. U.K.MANDAL
Tue Oct 29 11:01:03 2002
Name: Pankaj Seth
Email: to_pankajs71@rediffmail.com
Your Views: Cutting of interest rate further would certainly act as dampner for the common man and government servants in
particular to go in for investing money or savings in GPF. The retired personnel largly depend on the interests being earned on
their savings to meet their liabilities etc. These aged and senior citizen will be hit hard if the interest rates are further slashed.
There is already a simmering discontent in the hearts of Govt. servants as the interest rates on the GPF were lowered from 12%
to 9.5% if the rates are further cut than this discontent would transform into deep annoyance. The interest rate on GPF is
required to be kept at 12%. Further, instead of giving income tax rebate on infrastructure bonds, the contribution limit towards
GPF deposits may be increased to minimum of Rs. 1.25 lakhs so that this fund can be utilized by the Government of India itself
for widening the infrastructure base of the country.
Tue Oct 29 11:03:27 2002
Name: R.C.CHANDWANI
Email: rmcc_8@rediffmail.com
Your Views: Intrest rates already bottomed out.we should keep in view INDIAN CONDITIONS not copy U.S.A.No
achievement so far.Feeling of bankers O.K.Reforms reforms no results R.M.CC.
Tue Oct 29 11:04:36 2002
Name: kalra o.n.
Email: kalrapcs@rediffmail.com
Your Views: yes, RBI SHOULD CUT MARGINAL INTEREST RATES. BUT THE EFFECT WON`T LAND ON THE
BORROWER`S HEAD IMMED. SUBSEQUENTLY FREEDOM TO DISBURS MORE LOANS WILL OPEN
BECAUSE OF EXTRA FUND AVAILABILITY. REASON; POOR LOAN RECOVERIES; INCREASING OF BAD
DEBTS; RED TAPISM IN THE BANKS; NON-OPEN PROMOTIONAL ADVANCES AT RISKS AS COMPARED
TO FOREIGN MNC FINANCIAL COMPANIES/BANKS.
Tue Oct 29 11:08:14 2002
Name: Subir K.Mukherjee
Email: subirmukherjee@hotmail.com
Your Views: Interest rates should reduce by .25-.5%points,because of following: 1:Though manfr is growing it needs to grow
at a greater pace-lower rates will encourage this 2:Stock markets are going through a rough phase.With improved performance
fundamentals will improve and will to some extentraise the markets. 3:Lower rates will imrove income fund returns which in
return can plough back into the mfrg sector. 4:State Govt financial conditions are not too encouraging-one reason is because of
the debt servicing.Lower rates will mitigate some of this suffering 5: PF rates are unsustainable under present market conditions
and will need to be scaled down 6:Lower rates will draw money out of bank savings account and plough into MFs and stock
markets which in turn will improve mfrg base and country's fundamentals 7:Once stock markets begin to look up coupled with
rapid disinvestment foreign capital will begin to return and then only we will see a resurgence of the economy 8:Lower rates will
hardly increase liquidity from existing levels rather will divert savings from age old methods to more developed methods and
change the set minds of citizens which is neccessary if the country desires
Tue Oct 29 11:08:44 2002
Name: rahul.kapoor
Email: rahul1072@hotmail.com
Your Views: Interest rates shouldnt fall ,THink about 45% people who r living on interest what will happen to them .Very cruel
thing to do
Tue Oct 29 11:12:44 2002
Name: k.m.subba raju
Email: rgb cdp act @rediff.com
Your Views: to move towards soft interest rates it is necessary to have cut in Bank Rate for long term effect. It is also necessary
to have a repo rate cut to extend the credit at lower rate.
Tue Oct 29 11:15:10 2002
Name: middle class
Email: aamir_boy@hotmail.com
Your Views: No. the interest rates sud not b dropped. As essential commodities prices hv increased, travelling hv become
costlier, retrenchment of jobs, misused of employers to employees, jobless, etc., etc., no increment, after taking this account all
this factors, their is only standard of middle class living is banking sector (for a long living & better standard of education to
child/ family member) , so after taking into account all this factor the rates sud not b dropped infact it sud b increased for a
lower and middle class people. akhan
Tue Oct 29 11:15:12 2002
Name: NISHANT
Email: NISHANTSINGHI@REDIFFMAIL.COM
Your Views: IF INDIA IS TO ATTAIN A GROWTH RATE TARGET , FIRST THING TO MAKE BUSINESSES
MORE COMPETITIVE IS COST OF FUNDS TO BUSINESSES. IN RESPONSE TO IT I EXPECT A RATE CUT
FROM THE GOVERNOR. ALSO IN LINE WITH GLOBAL TREND ,INDIA WHICH HAS ONE OF THE HIGHEST
INTEREST RATES ,SHOULD BE DROPPED.
Tue Oct 29 11:16:55 2002
Name: viswanathan rajagopalan
Email: vishu@advertisingavenues.com
Your Views: NO, BECAUSE ALREADY THE BANKS ARE FLUSHED WITH FUNDS AND THERE ARE NO
TAKERS EVEN AT THE CURRENT RATE OF INTEREST , WHEREAS THE REDUCTION IN INTEREST WILL
FURTHER AFFECT THE PEOPLE WHO SOLELY DEPEND ON INTREEST INCOME.
Tue Oct 29 11:17:38 2002
Name: N Vakil
Email: nvakil@vsnl.net
Your Views: Dropping Interest rate will cause a further dip in saving for Middle Class - who are the real driver of our
economy.They will go into a shell and then spending would be more sparse making the manufacturing sector whine once again.
The real problem in economy is feel good factor which is missing and unless Govt. starts creating this environment nothing will
help.First the Govt. whether BJP at centre or Congress at each state must get down to creating a happy environment.Stop mud
slinging, stop crying foul,stop blaming others and give a clean , honest , SECURED goverance.As a nation we cannot live
together , share water - then how can a good solid atmosphere of booming business happen ! Last interest cuts has not
produced any mircales and I am sure another cut will be just be one more dull move by RBI.
Tue Oct 29 11:17:58 2002
Name: v.ramanathan
Email: premrams@hotmail.com
Your Views: intrest rates are often cut on begging and pleading of industialists so that on lower rates loans will be available
which will lead in increase of overall production. but till today this cii members are highest loan defaulters and main cause of
npas in public sector banks. so the government is the loser along with many senior citizens and middle class who have invested
in fds. so rbi should not go for this rate cuts infact it should increase it so that treasury will have more liquid money as the
deposits will increase.
Tue Oct 29 11:18:36 2002
Name: MALAY Kr. GHOSAL
Email: mkg4@rediffmail.com
Your Views: There should be two options. High rate of interest for the Senior citizens, untimely widows with her children and
the physically handicapped group. Rest with low interest. People will get attracted to do the business,improves higher
productivity, result more employment, conclude better economy, creation of more demands and a better India. Rbi is the house
who can insist people for doing business not to wait for the service as our major people still do that.
Tue Oct 29 11:19:03 2002
Name: MALAY Kr. GHOSAL
Email: mkg4@rediffmail.com
Your Views: Yes. But there should be two options. High rate of interest for the Senior citizens, untimely widows with her
children and the physically handicapped group. Rest with low interest. People will get attracted to do the business,improves
higher productivity, result more employment, conclude better economy, creation of more demands and a better India. Rbi is the
house who can insist people for doing business not to wait for the service as our major people still do that.
Tue Oct 29 11:25:15 2002
Name: amdude
Email: amdude@rediffmail.com
Your Views: Yes
Tue Oct 29 11:29:04 2002
Name: Vijay
Email: fly4vijay@yahoo.com
Your Views: No way, it should not be done, otherwise the interest of lower income group will be drastically affected.
Tue Oct 29 11:31:22 2002
Name: S B KOLHAR
Email: sbkolhar@yahoo.com
Your Views: Interst rate shold be brought down to international level.This is required to make indian industry competetive in the
world market.Since inflation rate is mderate and declining there is case for reduction in interst rate.
Tue Oct 29 11:33:53 2002
Name: Devesh Chaturvedi
Email: chaturvedi_devesh@yahoo.com
Your Views: Rate of bank intrest should be seen in context with the inflation and other avenues available to common person for
investment. As of now , even thogh the intrest rates have dropped so much there is no other place where once can think of
investing his money.Govt knows this and is black mailing the public by reducing the rates.instead it should concentrate on
reviving the stock market by it's policies.and also try to control the inflation.Before dropping the intrest rates ,thought should
also be given to plight of senior citizens who depend mainly on Bank Fixed deposits for regular and safe income(specially after
the unit MIStrust of India fiasco).
Tue Oct 29 11:34:20 2002
Name: K. Balakrishnan
Email: bala_gipcl@yahoo.com
Your Views: Any further cut in interest rates is going to affect ritered persons drastically. A large number of retired persons do
not receive any pension and has to live only on interest earned. I would therefore hope that Government would keep this in
mind while thinking of an interest cut.
Tue Oct 29 11:34:35 2002
Name: rohit kedia
Email: roked@indiatimes.com
Your Views: it is imperative for the indian economy to keep pace with the global trends. the consumer is truly becoming the
king. Over the past few years their has been a steadily developing supply glut in the economies of the world. at the same time
the unforseen incidents have been making the consumer vary of spending. their has been a general push towards saving for the
future. to unlock and unharness this trend, the only way out it seems is the incentive given in terms of cheaper credit. needless to
mention this helps is and every constituent in the economy to remain afloat in difficult times and give that much needed
sustainable advantage. This in turn facilitates prolonged push to rejig the saggining economy. we saw the same happening to an
extent with last years rate cuts. Time has come to give another push as a proactive measure for the indian economy. The
rejuvenating signs in the economy if needs to be sustained, then the rate cut i think is imperative. although in so many words we
cannot bring the whole essence of reasoning but i thnk looking at it superficially in the present context, a rate cut is definitely in
the better interest of indian economy.
Tue Oct 29 11:36:33 2002
Name: RAM NIWAS SHARMA
Email: ramniwas@sungroseeds.com
Your Views: I HOPE RBI MAY BE CUT THE INTEREST RATES.
Tue Oct 29 11:50:38 2002
Name: sameer naimpally
Email: sameer2812@rediffmail.com
Your Views: A reduction in interest rates especially on deposits causes a reduction in the future income by way of interest on
funds invested. To maintain the present lifestyle, a person needs to invest additional money in deposits to maintain the same
level of income in future. This would lead to lower amounts of disposal income leading to lack of demand for goods & services.
Lower demand for goods & services would cause corporates to cut down production of goods. This would lead to
retrenchment of labour and thereby higher unemployment. The will lead to a recessionary cycle with increasing unemployment,
lower disposable income, lack of demand for goods and services. The Indian economy cannot be compared with the US
economy which has a strong social security system to take care of a persons future. Since such a financial security system does
not exist in India, interest rates should not be cut simply because the developed countries like US cut their interest rates.
Tue Oct 29 11:52:37 2002
Name: Doris D'Souza
Email: dorisds2002@yahoo.com
Your Views: It would be like being inconsiderate to the Old and Retired
Tue Oct 29 11:53:24 2002
Name: saidas
Email: saidasg@rediffmail.com
Your Views: Yes, they shld drop and also shld drop income tax rates. In fact all interest related investments shld have tax
rebates and low interests for everyone but retired senior citizens & single housewives.
Tue Oct 29 11:55:19 2002
Name: Jayakarthikeyan.P
Email: jaya_karthik@rediffmail.com
Your Views: Of course the RBI can cut interest rates and apply conditions such that loans will be given on the basis of
securities, which can be easly sold to recover the money back in case the borowwer dose'nt payback. And as per most of the
business magazines and news papers there is huge cash reserve in most of the banks due to fear of non-payment by the
customer. And in some cases the customers think the interest rates are very high. And it makes no sense on the Bank's side by
keeping the money without circulating it as most of the industries are sick and need immediate relief,atleast to minimise the
extent of damage that has occured so far and also help in preventing the rising unemployment rate.
Tue Oct 29 11:58:57 2002
Name: atul.kapadia
Email: atulkapadia@nellaimills.com
Your Views: It is neccessary to cut the interest rates.For all small industries working on meagre capital have to borrow money
from marwadis at 2.5 % for running day to day business. This class is exploiting the honest and sincere people who are eager to
promote and reach higher level in exports too. bankers have enjoyed luxourius era after independence. askthem to reduce their
adm. expenses and contribute for well fare of the nation.
Tue Oct 29 11:59:26 2002
Name: KISHAN SINGH
Email: chetan_ks2000@rediffmail.com
Your Views: Interest rates under Monetary & Credit Policy should be decresed from the current rates.
Tue Oct 29 11:59:43 2002
Name: shashikansal
Email: shashikansal@rediffmail.com
Your Views: the interest rate on small savings should not be cut further as it would hit retired people.
Tue Oct 29 12:03:35 2002
Name: chandru
Email: chandru_hm@rediffmail.com
Your Views: Interest rates should be reduced keeping in mind the global scenerio,this may effect the retired people in a short
run but will definately a good move.Government should also keep social security in mind to help the people. unless people feel
they are safe in their later days this will not going to work in our country & will put pressure on the economy.
Tue Oct 29 12:13:50 2002
Name: atul.kapadia
Email: atulkapadia@nellaimills.com
Your Views: It is neccessary to cut the interest rates.For all small industries working on meagre capital have to borrow money
from marwadis at 2.5 % for running day to day business. This class is exploiting the honest and sincere people who are eager to
promote and reach higher level in exports too. bankers have enjoyed luxourius era after independence. askthem to reduce their
adm. expenses and contribute for well fare of the nation. Raid the underworld agents who are rotating underworld's finance in
films, diamond & Building Industry. This will be the most welcome feature as it will expose not only the links but stop the
parallel black market economy. Planning commission the can work better and give assured results. Provide the sale of
computers on very low rate of interest for all houses, it will have tremendous educational impact. Self learning educational kits
should be made tax free. We are satisfied with the present Government steps to mobilise the public opinion. This is a country
with different relgion and communities, lower the interest rates on all educational fields for all ages and see the difference.
Encourage industries to bring in technology from overseas .
Tue Oct 29 12:14:54 2002
Name: S.S.Kumar
Email: samay_ssk@yahoo.com
Your Views: I will not be in favour of reduction of Bank rate by RBI. It may have impact on bank profits if they do not reduce
the bank interest. Hence, in the long run banks will reduce the interest in deposits. The common man will be affected due to
such policies. Especially, retired persons depend on the bank interests. Already, they are in trouble due to less income through
bank interests, their source of survival. They cannot invest in highly unreliable capital markets. Hence, banks should not reduce
the interest rates. This reason in turn demands the RBI to not to lower the bank rate. S.Srinivas Kumar
Tue Oct 29 12:20:48 2002
Name: Rasik Patel
Email: rasikbpatel@rediffmail.com
Your Views: No bank rates should not be cut. Bescause these rates are at minimum lavel. Due to scams in Co-operative
banks, middle class people and senior citizen put their deposits in nationalise banks. And they should get atleast these interest
on their deposits to run their elder life.
Tue Oct 29 12:32:58 2002
Name: KISHAN SINGH
Email: chetan_ks2000@rediffmail.com
Your Views: Interest rates under Monetary & Credit Policy should be decresed from the current rates.
Tue Oct 29 13:46:51 2002
Name: Rafique Ahmed
Email: rahmed7@rediffmail.com
Your Views: Yes, this is in line with the global trends,Its very important for us to be competative in the global market
place,besides this could trigger the demand by way of expansion as it creates new segments in terms of affordability.
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