Union Home Minister Amit Shah praised the Reserve Bank of India for delivering a new set of monetary stimulus to financial markets on Friday saying that the steps will help farmers, small businesses and financial institutions. The RBI announced a Rs 50,000 crore special finance facility to financial institutions such as NABARD, SIDBI and NHB that will inject liquidity into agriculture, real estate and MSME sector.
Modi government is leaving no stone unturned in this fight against COVID-19, ensuring minimum disruption in people’s lives while planning for a strong and stable India in days ahead.— Amit Shah (@AmitShah) April 17, 2020
Steps taken by RBI today, to boost Indian economy, further reinforce PM @narendramodi’s vision.
RBI’s decision to extend 25000cr credit facility to NABARD will greatly help our farmers, 15,000cr to SIDBI will provide much needed financial stability to MSMEs & startups, boost the Make in India program. 10,000cr to NHB and liquidity measures for Banks & NBFCs will help too— Amit Shah (@AmitShah) April 17, 2020
The RBI cut the reverse repo rate and announced a slew of measures including a re-finance window of Rs 50,000 crore and Targetted Long Term Repo auction of a similar amount to deal with the impact of the COVID-19 pandemic. The central bank's Governor Shaktikanta Das assured that RBI will use all instruments at its disposal to deal with the challenges posed by the outbreak of the novel coronavirus, depending on evolving situations. This is not the last of the announcements. Based on evolving situations, the central bank will come up with responses in the future in the interest of the economy, he said.
In his address, the RBI governor thanked the people involved in essential services. Quoting IMF, the RBI governor said that 1.9% GDP growth for India is highest in G20 countries. He added that India is expected to post a sharp turnaround in 2021-22. He announced that RBI has cut reverse repo rate under the liquidity adjustment facility (LAF) from 4% to 3.75%. This will encourage banks to lend to the productive sectors of the economy.
Stating that the RBI is monitoring the situation developing out of the COVID-19 outbreak, Shaktikanta Das noted that the contraction in exports in March at 34.6% much more severe than the global financial crisis of 2008-09.