New Delhi [India], October 7 (ANI): ASSOCHAM Secretary General Saurabh Sanyal on Wednesday welcomed the Reserve Bank of India's 25-basis-point repo rate hike, saying the increase was necessary to contain inflation while economic growth and most major sectors remained resilient.
The RBI's Monetary Policy Committee on Wednesday raised the policy repo rate by 25 basis points to 5.50 per cent amid rising inflation risks, while maintaining a strong outlook for domestic economic growth.
"This is a very good move by the RBI Governor... the 25-basis-point increase is not a very large hike. It has been done to control the inflationary trend," Sanyal told ANI.
He said the rate increase would help tackle rising price pressures without significantly disrupting growth momentum.
"Overall, the 25-basis-point increase was a very welcome move by the RBI and was necessary to contain inflation," he said.
Sanyal pointed to India's strong economic growth and said several manufacturing segments continued to perform well. India's economy grew 7.8 per cent in the April-June quarter, while the RBI on Wednesday raised its growth forecast for 2026-27 to 7.1 per cent from 6.7 per cent.
"If you look at manufacturing, the automobile sector is already doing very well. Electronics and telecommunications are also performing very well. Most of the core sectors are doing very well, except textiles," Sanyal said.
He, however, flagged weakness in the textile sector, saying the employment-intensive industry required policy support.
"There has been some slowdown in textiles. Since textiles are the second-largest employment-generating sector, there are some weaknesses there. The sector needs government support to give it a push, and we are also making efforts in that direction," he said.
Sanyal also cautioned that agriculture could face some pressure in the coming quarter because of rainfall conditions, even as he remained positive about manufacturing and services.
"I believe India is doing very well in manufacturing, services and other sectors, including the medical and pharmaceutical sectors," he said, adding that agriculture could see "a slight setback" in the coming quarter.
Separately, Sanyal, speaking on Prime Minister Narendra Modi completing 25 years since taking office as Gujarat Chief Minister on October 7, 2001, said the period had seen increased emphasis on development, innovation, startups and SMEs.
"The pace at which he has driven the development of our country, brought innovation, promoted startups and supported SMEs has been remarkable," Sanyal said, extending congratulations on behalf of ASSOCHAM and industry. (ANI)
RBI’s 25 bps rate hike necessary to contain inflation, textiles need support: Saurabh Sanyal
