Reserve Bank of India(RBI)released Mid-Quarter Monetary Policy Review:September 2012 and reduced only the Cash Reserve Ratio(CRR)by 25 basis points and kept other key policy rates Repo Rate and Reverse Repo Rate unchanged.
While giving reaction to this policy review,Dr.A.Sakthivel,President,Tirupur Exporters'Association(TEA)said he was not happy with the RBI decision and added that the Repo Rate cut was long expected one for the revival of the knitwear exporting units as that measure could help to reduce the borrowing rate of the knitwear exporters,mostly in SME sector.
However,Dr.A.Sakthivel felt that as the CRR has been reduced,the banks will have more liquidity and with this,they could give more credit to the borrowers,particularly to SME units,which is required at this hour of crisis due to recession in the EU&US market.Also,considering the over all situations,the Banks may also think of reducing the interest rates.
