‘We have placed prudential contingency plans to infuse liquidity if needed’
The Reserve Bank of India will take measures to minimise any excessive volatility in the rupee after the Lok Sabha results are announced on Friday, Governor Raghuram Rajan said here on Thursday.
The Governor, while talking to the media persons after the RBI board meeting, also disclosed that a contingency plan had been discussed with the Finance Ministry to deal with any stock market volatility after the election results were declared. On the issue of privatising the public sector banks, Dr. Rajan said the report of the P J Nayak committee was an outside attempt by an individual. Although having very valuable, respected and valid suggestions, the central bank had no intentions to accept this. He also expressed concern over the prevailing rate of around 10 per cent NPAs in private sector banks. He said it was an alarming number, and the RBI was not comfortable with this and it was only the growth that could bring it back on track.
On his meeting with the State-level bankers’ committee, he said the hill State was largely a richer State with a higher per capita income.
The State has a branch on every 3,009 people here. But the habitations were remote here and the weather was a precarious problem which needed a mobile technology, he added.
“We assured the board that we are in discussions with the Finance Ministry and the Securities and Exchange Board of India, and we have placed prudential contingency plans to infuse liquidity if needed. We hope that everything will go normally tomorrow when the election results are announced,” Dr. Rajan said.