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RBI projects GDP at 10.5% in 2021-22; Keeps repo-rate unchanged at 4% and reverse repo-rate at 3.35 per cent

RBI Governor Shaktikant Das today said the government and the RBI have discussed the idea of a bad bank and will examine the formal proposal on the ARC once it is made. He was speaking in the press conference via video conferencing after the announcement of Sixth Bi-Monthly policy review today. He expressed his views about the Asset Reconstruction Company proposed by the Centre during the budget for 2021-22.  

He said that the bank is making its own assessment of true state of NPAs in each bank and expressed confidence of managing the borrowing program in a non-disruptive manner.

Speaking about the retail participation in government securities he said that,as part of continuing efforts to increase retail participation in government securities and to improve ease of access, it has been decided to move beyond aggregator model and provide retail investors online access to the government securities market – both primary and secondary – along with the facility to open their gilt securities account with the RBI.

He added that direct retail participation in the bond market is a major structural reform and it is endeavour to make the G-sec market accessible.

Commenting about the current scenario he said the macroeconomic situation is constantly evolving and market has its own way of interpreting things. He made it clear that he has not spelt out June as the date on which the accommodative guidance will end and he had only said the accommodative stance will continue into the next financial year.

Deputy governor BP Kanungo also gave an explanation about the retail participation scheme. He said that it is necessary that the investor base is broadened due to government borrowing size and said that the bank will come out with details on retail participation in g-sec market very soon.

RBI governor also assured that the retail direct plan will not harm the banks and said that with growth in GDP the Indian economy will continue to grow and the total volume of savings and deposits will expand with it. He said that the digital currency is a work in progress at the central bank and the government is looking to launch a state owned digital currency.

 

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