"By and large, its a very good policy... RBI shared our concerns that nothing should be done or is warranted that will hamper growth," Chidambaram told reporters reacting to the busy season credit policy unveiled by RBI in Mumbai.
"Nothing has been done to hamper growth... investment growth momentum will continue," he said.
The repo rate hike of 0.25% was meant to suck excess liquidity and help in reining inflation, he said, adding "as I see the situation, nothing will affect growth."
On the oil price pressure, Chidambaram said "We are doing everything to keep prices under control. We have to take steps to counterveil high oil prices."
On RBI's hike in inflation projection to 6.5% from the earlier 5%, Chidambaram said "the higher inflation estimate is due to higher oil prices (in global market)."
A.K. Purwar, chairman of SBI, said the mid-term review of monetary policy by the RBI is broadly growth-oriented.
He was talking to reporters after the central bank announced a 25bps increase in repo rate to 4.75% w.e.f tomorrow.
K. Cherian Verghese, chairman and managing director of Corporation Bank, said the bank would not raise interest rates following the RBI move to hike the repo rate.
"The policy signals stability and growth," Verghese said.
P.S. Shenoy, chairman and managing director of Bank of Baroda (BoB), also ruled out any rate hikes after the RBI moves.
