The rate cut by the RBI will give a boost to the Indian economy by providing affordable Loans to small businesses and homebuyers Said by Finance Minister Piyush Goyal.
RBI’s decision to reduce the repo rate by 25 basis point from 6.5 percent to 6.25 percent and change of stance to ‘Neutral’ will give a boost to the economy, lead to affordable credit for small businesses, homebuyers etc and further boost employment opportunities,” Goyal said in a tweet.
It is a very balanced and pragmatic policy statement said by Economic Affairs Secretary Subhash Chandra Garg with Welcoming the RBI’s decision.
“Assessment of growth and inflation is quite realistic and underlines low inflation and high growth path for India for 2019-20. Welcome change of stance to neutral and rate cut by 25 bps. Also welcome removal of FPI restriction,” Garg tweeted.
It was fixed that no foreign portfolio investor (FPI) should be given an exposure of more than 20 percent of its corporate bond portfolio to a single corporate, including exposure to entities related to the corporate. As a part of the review of the FPI investment this was decided in corporate debt undertaken in April 2018.
Exemption were given to FPIs from this requirement till end-March 2019 to adjust their portfolios on their new investments.
The RBI in its sixth bi-monthly policy said it is now proposed to withdraw this exposure limit, In order to encourage a wider spectrum of investors to access the corporate debt market.