India: 'Govt, banks to benefit from rate cut'.

CHENNAI, Feb. 27. THE Reserve Bank of India's announcement reducing the Bank Rate and the cash reserve ratio by 0.5 per cent each will not help any section of industry. It is meant to help the Government and bail out the banking sector, according to the noted economist and former Economic Adviser to RBI, Dr T.K. Velayudham.

Speaking at a discussion on 'Impact of the recent reduction in Bank Rate on the economy' organised here by the Triplicane Cultural Academy, Dr Velayudham said the reduction in the Bank Rate would help the Government borrow cheaper. The money released into the banking system by the CRR cut would help the banks in two ways: to find resources to pay …