Madhya Pradesh Chief Minister Shivraj Singh Chouhan on Friday hailed the steps taken by the Reserve Bank of India (RBI), stating that the Indian government is leaving no stones unturned to aid the citizens of the country at this time of crisis. 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.
Taking to Twitter, Chouhan stated that the announcement by RBI will not only benefit the farmers, MSMEs, startups and the common man but will also revitalise the economy.
While the country is battling the deadly #COVID19, Indian government is leaving no stone unturned to aid its citizens. The RBI's announcements will not only benefit the farmers, MSMEs, startups and the common man but will also revitalize the Indian economy!— Shivraj Singh Chouhan (@ChouhanShivraj) April 17, 2020
Prime Minister Narendra Modi on Friday also stated that it will enhance liquidity and improve credit supply. He added that the measures by the RBI will be a boost to the small businesses and MSMEs, farmers, as well as the poor.
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.