In a statement reacting on RBI’s decision to hike rates by 25 bps, CII director general Chandrajit Banerjee pointed out that even with as many as ten upward revisions in policy rates since March 2010, there has been little respite from inflation. Monetary tightening, on the other hand has resulted in the drop in growth of industrial and economic indicators. He warned that if the slowdown accentuates further from here, it would be difficult and time consuming to bring the growth performance back on track as the economy is yet to fully recover from the impact of global financial crisis.

CII chief said that it is imperative now that investment demand is given a fillip through announcements and clearances of some large projects which are awaiting approvals and simultaneously addressing the supply side issues. It is also the proper time to look at the fiscal policy and how it can be utilized to maintain the balance between growth and inflation, he added.