In the midyear review of the Credit Policy for the year
2003-04, Reserve Bank of India governor Dr Y V Reddy
has focused on "continuity." With no cuts
in the interest rate, though against market expectations,
the review focuses on continuity and provides a stable
and predictable policy environment. Furthermore, the
bias towards "soft and flexible interest rates"
review of the macroeconomic conditions is heartening
with forecasts of the gross domestic product growth
for 2003 being revised upwards to 6.5-7 per cent and
the wholesale price index being revised downwards to
4-4.5 per cent. This will certainly strengthen the opinion
of various market participants that the Indian economy
is among the fastest growing in the world.
permission granted to mutual funds to issues and redeem
units in the Securities and Exchange Board of India-approved
offshore funds and the remit dividends payable overseas
will have a far-reaching impact on simplifying the launch
and administration of such schemes.
is the managing director of HDFC Mutual Fund)