FICO demands reduction in Repo Rate to save MSME Sector
The Reserve Bank of India (RBI) has increased the policy repo rate by 0.5 per cent, which was increased by 0.4 per cent last month.
Ludhiana, June 9, 2022: The Reserve Bank of India (RBI) has increased the policy repo rate by 0.5 per cent, which was increased by 0.4 per cent last month. The Federation of Industrial & Commercial Organization (FICO) strongly oppose this increase in repo rate and demands an immediate rollback.
K.K. Seth Chairman and Gurmeet Singh Kular President, FICO said that when the repo rate goes up, the repo rate linked lending rate (RLLR) of banks also goes up, due to which the interest rate on loans given by banks to the industry will go up. It would lead to an increase in the cost of production by which trade and the industrial sector will suffer further.
They added need not to mention that the industry, especially the MSME Sector is struggling due to the prolonged impact of Lockdowns to curb Covid-19, followed by a shortage of labour and a steep rise in raw material prices, now the increase in the rate of interest will only make the situation worsen for the industrialists. It is the time that the government must hand hold the industry and provide them with a relief package, rather than imposing an additional burden.