New Delhi: The apex industry group ASSOCHAM has asked the Reserve Bank of India's Monetary Policy Committee (MPC) to stop further increases in loan rates due to the uncertain nature of the global business climate as the MPC of the central bank prepares to revise the benchmark policy rates.

ASSOCHAM's Ajay Singh said, "Though India remains the largest economy and the one with the fastest rate of growth, growth is uneven even as the threat of a global recession, fluctuating energy prices, and geopolitical unrest must all be closely monitored."

The president stated that ASSOCHAM is asking for an end to any further increases in interest rates, "unless there is a radical change in circumstances," in this context.

"We believe the economy has hit a saturation point beyond which it may be challenging to sustain any further rate increases. According to some sources, the RBI Monetary Policy Committee is considering raising the repo rate by an additional 25 bps (basis points), " he added.

According to the new ASSOCHAM President, rate-sensitive industries like real estate, including residential buildings, passenger automobiles, and commercial vehicles, may experience unfavourable effects from the rate increase.

India is "on the verge of an opportunity to become a manufacturing hub for the global giants," according to Sood. "All the policy support should be provided in terms of their vendor development program, meeting their raw material requirements, etc.," he continued. "Those wanting to diversify into India or expand their operations here."

The majority of micro, small, and medium-sized enterprises (MSMEs), according to Singh, are in the services industry, specifically commerce, street vendors, eatery proprietors, small transit operators, job contractors, or medium-sized businesses.

Despite the fintechs' rapid outreach to them, Singh claimed that they still require assistance in order to utilise their cutting-edge tools like artificial intelligence (AI), both for working capital and marketing assistance. As a result, MSMEs can use AI-based tools to promote their companies. Additionally, the economy would become even more formalised as a result, he continued.

Similar to MSMEs, food administration should make use of technologies like AI for supply and manufacturing. According to Ajay Singh, technology platforms should connect farmers with fast-moving consumer goods (FMCG) businesses, local distribution networks, state governments, the federal departments of food and consumer affairs, earth science, agriculture, farmers' welfare, and rural development.

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