A committee of top government officials, industry representatives, bank chiefs and the Reserve Bank of India officials will be formed shortly to hammer out a turnaround strategy amid signs of a reduction in overall lending rates.
“The committee will look into various issues pertaining to different sectors,” Cabinet Secretary KM Chandrasekhar said after a meeting with PSU bank chiefs and industry chambers on Thursday. India Inc. has sought cheaper access to bank funds to keep planned expansion projects going.
State Bank of India chairman OP Bhatt said: “Interest rates should come down in the next six to eight weeks, although it is difficult to say anything on the quantum of the reduction.”
The RBI has cut the repo rate — the rate at which banks borrow from the central bank — by four percentage points to 5 per cent in the last six months.
“One of the major challenges facing India Inc today is availability of capital at the right cost,” said Harshpati Singhania, president of Federation of Indian Chambers of Commerce and Industry.