Lowering Of Interest Rate

As I usually say that low interest rate is not the the only key to growth and social justice RBI Governor has cautioned world of ill consequences of lowering of rate of interest. Low interest rate not only causes pain to senior citizens and retired persons whose source of income is only interest incone, it also reduces savings rate and investment capacity of a nation, specifically developing and under developed nation. It adversely affects growth agenda of a country and forces individuals and corporate to save their as surplus income in gold,real estate or other Non-BJP productive avenues. It is important to mention here that I'll consequences of  low interest regime which was resorted to  by past UPA government are appearing in term of rise in bad debts and frauds in banks and which reduced GDP growth rate to bare minimum.

Government should try to keep interest rate at moderate level like 10 percent which is neither anti-savings, not anti investment and neither does it causes pain to old people in their old age.

Rise in bad debts in PSU banks is not caused by interest rate as much as it is caused by corrupt and ineffective officials ,  business men and  politicians.

I therefore hope government will try to understand the advice given by outgoing RBI Governor Mr Raghuram Rajan and act accordingly. Even indirect pressure on bankers and RBI creates improper rate war and finally create harmful impact on not only health of bsnks but on entire economy.