RBI policy reaction: Utsav Johri, Partner, JSA

10 Aug 2023 , 12:34 PM

RBI has kept the Repo rates unchanged reflecting cautious optimism towards the Indian economy. This is in line with the expectation from RBI and will help shape the upward trajectory of the Indian economy. The Governor emphasized that RBI remains focused on achieving an inflation target of 4%. RBI will have to take pragmatic steps to achieve this in view of the domestic retail inflation, volatile international food and energy prices, extreme weather changes and geopolitical scenario.

The lending rates will remain stable. This is expected to further the lending activity and improve the real estate demand and investment by businesses leading to further economic growth.

The review of the regulatory framework for Infrastructure Debt Funds is also a welcome step. It will enable Infrastructure Debt Funds to play a greater role in the financing of the infrastructure sector and will also provide them with better access to funds through External Commercial Borrowings.