Wednesday, April 15, 2009

Higher Interest Rates Hindering Growth - April 15, 2009

ASSOCHAM, a leading representative of the Indian industry, believes that the small and medium enterprises and the rural sector will play an important role to give a boost to the Indian economy.

The rural area starts rebuilding and then the industry starts rebuilding, said Assocham president Sajjan Jindal. However, in this sector, the high interest rates are a deterrent to growth that mirroring the problems faced by the industry as a whole. Despite the several interest rate cuts by the banks, the sector is still starved of funding because of the high interest rates.

The SME sector is suffering from the high interest rate which is as high as 20 per cent and that is the stumbling block and also for sectors like real estate and infrastructure. Those are not even getting funds for the business, said Jindal.

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