CII President Anticipates RBI Interest Rate Cut; Urges Budget Focus on Job Creation
Sanjiv Puri, President of the Confederation of Indian Industry (CII), has expressed expectations that the Reserve Bank of India (RBI) will reduce benchmark interest rates in the coming month to stimulate economic growth. He emphasized the necessity for the forthcoming Union Budget 2025-26 to concentrate on job creation, particularly through targeted interventions in labor-intensive sectors.
Anticipation of RBI Rate Cut
Puri indicated that a reduction in interest rates by the RBI could serve as a catalyst for economic expansion. He noted that such a move would align with efforts to invigorate sectors experiencing sluggish growth, thereby fostering a more conducive environment for investment and consumption.
Budget Recommendations for Job Creation
Highlighting the critical issue of employment, Puri urged the government to implement specific measures aimed at labor-intensive industries. He suggested that the budget should include policies designed to enhance productivity and competitiveness in these sectors, which are pivotal for large-scale job creation.
Addressing Trade Challenges
Puri also raised concerns about the dumping of excess stock by countries like China, which adversely affects domestic industries. He recommended that the government consider appropriate trade policies to protect local manufacturers and maintain fair market conditions.
Decoupling Food Inflation from Interest Rates
The CII President emphasized the importance of de-linking food inflation from interest rate decisions. He argued that food prices are often influenced by factors beyond monetary policy, and separating the two could lead to more effective economic management.
Call for Labor Reforms
Puri reiterated the need for comprehensive labor reforms to create a more flexible and efficient labor market. Such reforms, he suggested, would attract investment and enhance employment opportunities, contributing to sustained economic growth.
As the Union Budget 2025-26 approaches, these recommendations from the CII reflect the industry’s perspective on fostering economic resilience and job creation in the face of global and domestic challenges.