There is still room for cutting interest rates by RBI: P Chidambaram

Hoping for further interest rate cuts from RBI, P Chidambaram contended that headline inflation has softened and there is a need to push growth to the potential level of 8 per cent.

"Well, I think so. We see the beginning of green-shoots, more enquires for loans and there are more project proposals, stalled projects people are beginning to enquire.

Replying to a question whether there was a case for further lowering of interest rate, FM said, "I think at this time perhaps there is still a room for cutting interest rates, but let me add ...that is the call the (RBI) Governor has to take."

"The RBI has to weigh the fact that headline inflation has come down yet consumer price inflation is has to keep current account deficit in mind before it lowers interest rate.But government is always pro-growth and the government will always argue for lower interest rates," the Minister said.

Chidambaram also said that government is making all the efforts to make India an attractive investment destination.

"We can easily grow at certainly more than 7 per cent and close to 8 per cent... our potential rate of growth is 8 per cent. We have achieved it in the past between 2004 and 2008...we had 9 per cent growth in some of these years. I think we will climb back in 2013-14. We will climb back to 6 per cent plus in 2013-14 and in 2014-15 we should get back to 7-8 per cent growth," he added.

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Story first published: Wednesday, April 3, 2013, 13:31 [IST]
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