The Reserve Bank of India’s decision to keep the policy repo rate unchanged at 5.25 per cent reflects a balanced approach to containing inflation while supporting economic growth amid global uncertainties, the PHD Chamber of Commerce and Industry (PHDCCI) said on Wednesday.
Reacting to the Monetary Policy Committee’s (MPC) decision, PHDCCI President Rajeev Juneja said the policy comes at a time when inflation remains within the RBI’s target range, despite risks arising from geopolitical tensions, global energy prices and potential weather-related disruptions.
“The Indian economy remains resilient, boosted by domestic demand, sustained manufacturing activity, strong capacity utilisation, robust credit flow and the government’s continued thrust on infrastructure,” Juneja said.
He said services exports are expected to remain robust, while merchandise exports are likely to benefit from recent trade agreements and ongoing efforts to diversify export markets.
The industry body said key banking sector indicators remain healthy, with surplus system liquidity, broad-based credit growth across sectors and adequate foreign exchange reserves supporting macroeconomic stability.
PHDCCI also welcomed the RBI’s additional measures aimed at strengthening the cooperative banking sector, including draft guidelines for resuming the licensing of urban cooperative banks and a review of the credit monitoring framework for rural cooperative banks.
“The policy reflects a balanced view of upside risks facing the economy. While global uncertainties continue, RBI’s decision responds appropriately to macroeconomic developments,” said PHDCCI Chief Executive Officer and Secretary General Dr Ranjeet Mehta.
He added that the MPC’s continued emphasis on maintaining price stability while supporting growth would sustain economic activity and reinforce India’s position as the world’s fastest-growing major economy.
According to PHDCCI, the RBI’s policy decision is expected to provide stability to businesses and investors while preserving the economy’s growth momentum amid evolving domestic and global challenges.
(With inputs from IANS)
