The Reserve Bank of India (RBI) temporarily relaxed rules for bank loans to the microfinance sector, which will allow banks to continue lending to the embattled industry, and unveiled proposed guidelines for the lenders to the poor.
Finance minister Pranab Mukherjee has met state finance ministers in a pre-budget consultation meeting. Apart from putting across their demands to the central government, state finance ministers wanted greater action from the centre on controlling inflation.
Under attack for surging inflation, Prime Minister Manmohan Singh on Wednesday exuded confidence that prices would stabilise by March but said certain factors were beyond the control of the government.
Finance Minister Pranab Mukherjee today met state finance ministers in a pre-budget consultation meeting. Apart from putting across their demands to the central government, state finance ministers wanted greater action from the centre on controlling inflation.
The high food inflation is being driven by supply bottlenecks and rising incomes, Finance Minister Pranab Mukherjee said in a statement on Wednesday.
Analysts expect the Reserve Bank of India (RBI) to raise key rates by only 25 basis points on January 25 despite sticky inflation, as a slump in industrial production growth suggests some risks to economic momentum still exist.
Last year, lentils and sugar pushed up food prices in India. Now the surging cost of onions, tomatoes and edible oils is driving broader inflation.
The Reserve Bank of India has temporarily relaxed asset classification rules for bank loans to the microfinance sector, a move that it said will allow them to continue lending to the industry.
The uncomfortably high inflation will subside only gradually in the coming quarters as the economy continues to race ahead, likely prompting the central bank to hike interest rates more aggressively than earlier thought, a Reuters poll showed.
The oil ministry will seek changes in crude and products duties after industry asked for cuts, Oil Secretary S Sundareshan said on Wednesday, as international crude prices hover near two-year highs.
Trade Minister Anand Sharma said on Tuesday monetary policy may not be the right tool to fight high food inflation, in a strong political signal against a rate hike in next week's Reserve Bank policy review.
Finance Minister, Pranab Mukherjee has said that India’s economy recovery was broad-based and driven by the industry. “The rapid recovery of growth momentum is comforting but we cannot be complacent as there are several challenges Indian economy faces.
RBI governor D Subbarao has hinted that the credit policy due on the January 25 will indeed carry a rate hike. However, he has also stressed the need to save the growth story, and this is giving hope that rate hikes may not be as harsh as originally feared.
The agricultural ministry is demanding 100% foreign direct investment (FDI) in multi-brand retail and is keen that 50% of this should be for back-end, sources from the government tell CNBC-TV18.
The companies have sought a meeting with the Finance Minister on Tuesday and are requesting for the Finance Minister to abolish import and excise duty on oil which were levied in the last budget.
Inflation is expected to ease to around 6.5% by end-March, Finance Secretary Ashok Chawla said on Monday.
The Reserve Bank of India (RBI) chief said on Monday the country is facing surging inflation and it needs to calibrate monetary policy in order to manage inflation and also support growth.
Stubbornly high inflation has been dominating the government's and RBI's mindspace. In an interview with CNBC-TV18, Siddhartha Sanyal, Chief India Economist, Barclays Capital and Taimur Baig, Chief Economist, India Global Markets Research, Deutsche Bank AG gave their outlook.
Inflation dominates the headlines, dominates the government's mindspace and the RBI's. The December inflation number stood at 8.43%, compared to 7.47% in November.
This time the consensus seems to be that the markets will be okay in 2011 but the start has been horrific. It is not looking like a very quiet year that has been predicted by many investment banks. Aditya Narain, MD and Head-India Research, Citigroup said the he does not expect too many swings during the course of the year.
The December inflation has come in at 8.4% today. This is capping the week when even the prime minister held several consultations. But, he was unable to propose any concrete plan to be able to bring inflation under control. Can we do anything to rectify the situation? Are we faced with fate comply?
In an interview to CNBC-TV18's Shreen Bhan, Sen said that a sharp decline in the horticultural product prices would make that feasible.
India gold prices eased a tad on Friday afternoon following weakness in overseas market, triggering a slight pick-up in offtake for harvest festivals and wedding season slated later, though supply issues remained, which could push premiums even higher, dealers said.
The Reserve Bank of India (RBI) said on Friday a review of some banks revealed that in certain cases the lenders failed to monitor the use of funds by borrowers effectively, enabling them to divert the money into other areas.
However, Chief Economic Adviser to the Finance Ministry Kaushik Basu is optimistic that next months inflation number likely to be closer to 7%.