What is the credit policy trying to do?
We are trying to stabilise expectations and the objective circumstances are highly flexible for anyone who wants to invest. But it’s true that nobody will invest only because the interest rates are highly favourable. Then why have you cut the bank rate, repo rate and the cash reserve ratio? To take advantage of the present relatively good environment. From the monetary and inflation point of view, we want to say the RBI feels that interest rates are going to move south despite the drought. And the objective is to ensure that ample liquidity conditions continue. What do you expect from these cuts? A continuation of the present situation and an assurance that the liquidity situation and the interest rate environment remain soft. How do you expect the economy to respond? All things remaining the same….. positively. What is your greatest concern at the moment? Is it the state of the fisc? No. The fisc is a concern in the medium term, say, four or five years. If you ask me what the immedi
