New Delhi: With inflation coming down to single digits, CII chief K V Kamath on Sunday said key policy rates could be lowered to boost confidence of corporate India and spur growth.
But chairman and managing director of Bajaj Auto, Rahul Bajaj, would beg to differ.
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Kamath and Bajaj were speaking at the India Economic Summit organised by the World Economic Forum and industry body CII.
Kamath said the biggest challenge before the country, was to keep the confidence level high amid the global financial crisis, which has pushed the West into recession.
“I think India is in a distinctly different position. The challenge we have is how do we keep confidence in this global situation,” said Kamath, who also heads ICICI Bank.
India, he said, is different because despite global recession it would continue to grow by around 7% in the current fiscal and the growth will not be less than 6% during 2009-10.
Noting that in the next few weeks, Indian industry will have to work out strategies to meet the global challenges, Kamath said, “What will drive the Indian economy will be the domestic market”.
He further said deleveraging, cost cutting and declining commodity prices will have a benign impact on economic growth.