Revive growth,give monetary stimulus: CII

“We think the monitory policy is to be revised. Already,in early April we saw reduction in repo rate. We need further reduction,both in repo rate and CRR by 100 basis points,” Godrej said.

“Fortunately,inflationary expectation are coming down. Global commodity prices,particularly crude,are falling. This is the right time to create monitory stimulus that can revive the economy,” he observed.

He added that corporate profits have also been declining and the government should take corrective measures before things worsen.

The country’s GDP growth for 2011-12 was pegged at 6.5 per cent and during the fourth quarter,it was down to only 5.3 per cent,raising concerns among the industry and government.

Replying to a query on subsidies,the CII president said the government has to have political will to remove some of the ‘wasteful’ subsides though he felt that subsides,wherever important,should be continued.

“There may be some political difficulties that deter removing the subsidies. We need to bring down fiscal deficit.

ne of the ways is to cut subsidies. This is the time to show some sort of leadership and overcome political problems,” he said.

On Goods and Services Taxes,Godrej said the GDP may grow by additional 1.5 per cent if GST is introduced,adding the CII has been working with all stakeholders for early introduction of GST.

He also expressed concern over fall in investment saying “Investments create growth and if investments decline,then future growth will be affected.”