RBI will allow ample time for implementing changes regarding ECL, LCR: Governor Sanjay Malhotra
Malhotra emphasized that the RBI's position on the currency has not altered in response to worries over the rupee's continued depreciation
Governor Sanjay Malhotra – RBI – ECL – LCR – taxscan
Governor Sanjay Malhotra – RBI – ECL – LCR – taxscan
Governor Sanjay Malhotra of the Reserve Bank of India (RBI) announced on Saturday that the central bank is considering all recommendations about the proposed project financing guidelines and intends to hold a consultation process. The RBI will thereafter give enough time to implement adjustments related to project financing, liquidity coverage ratio (LCR), and expected credit loss (ECL).
In addition to discussing currency management, liquidity, and the recent repo rate drop intended to boost consumption, Malhotra made these remarks at a press conference. He emphasized that the RBI is working to improve loan availability and get the Unified Lending Interface (ULI) closer to the last mile. "We will provide ample time for the rollout of the LCR and will implement changes in phases wherever significant modifications to the guidelines are needed," he said.
The required regulations pertaining to bitcoin were also discussed by the governor. Although he could not provide many details, he did say that a discussion paper on cryptocurrencies is being worked on and that it was too soon to express his opinions before the article was published.
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"Whether it is inflation or growth, monetary policy and fiscal policy are like two tires of a car," Union Finance Minister Nirmala Sitharaman stated during the same press conference. Our public and economy will benefit from cooperation and collaboration. For this reason, I believe that the RBI and the government should coordinate on issues related to growth and inflation, especially growth bottlenecks.
Although the two institutions work closely together, Sitharaman said that their roles do not overlap. "I don't believe there has been any crossover in the past ten years, and I don't see it happening anytime soon. "The RBI and the government have effectively coordinated," the finance minister said.
According to Malhotra, the central bank would monitor any declines in the value of the rupee that could result in inflation. Malhotra attributed the rupee's steep fall to the recent increase in world unpredictability, especially in the wake of Trump's decision to raise tariffs on important trading partners like China, Canada, and Mexico.
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In the midst of deteriorating global market circumstances, foreign capital outflows and rising demand for dollars from oil importers have caused the Indian rupee to lately hit record lows. Malhotra emphasized that the RBI's position on the currency has not altered in response to worries over the rupee's continued depreciation.
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