Mr K. V. Kamath

Our Bureau

Kolkata, May 27 There is no case for the interest rates to move up in the immediate future, said Mr K.V. Kamath, President of CII and Managing Director and Chief Executive Officer, ICICI Bank, addressing a CII meeting, here on Tuesday.

“The systemic liquidity is quite comfortable and the credit offtake is not at a high level to warrant a rate hike. We need to watch carefully before tinkering with rates,” he said.

Mr Kamath said that Indian economy is estimated to grow at 10 per cent. However, high inflation numbers and the oil price pose some downside risk to the growth story. “There is a high rate of inflation everywhere around the world. However, the Indian government will work on bringing it down,” he added.

Speaking about the issue of land acquisition for industrialisation, he said that land acquisition should be in consonance with the will of the society. “It has to be understood that we cannot work against the people. Everywhere industry has come to realise this, and the steps taken by industry and government will be in consonance with the societal needs,” he said.

CII expressed concern over growing militancy and armed conflict in the eastern region and said it would take this up a serious agenda.

Investments to the tune of $700 billion have been made in infrastructure, manufacturing and other such sectors for the next three years. India’s investment rate stands at about 36 per cent and there is going to be no slowdown, said Mr Kamath. “Our investments are in tandem with the growth projection of 10 per cent,” he said.

Low agricultural productivity and weak supply chain also remain a challenge. There is a need to double the per capita income in the next ten years and this would require a GDP growth of 8-9 per cent per annum. “Simplification of labour laws, participation of private sector in the development of Tier II cities and facilitation of industrial restructuring is needed to grow at 10 per cent,” he said.

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