IT IS NO TIME TO TINKER WITH THE INTEREST RATE ( RBI REPO RATE ) OF THE NATION IN INDIA

IT IS NO TIME TO TINKER WITH THE INTEREST RATE (RBI REPO RATE) OF THE NATION IN INDIA


Dear Readers,

All of you may be reading in the internet or by any media discourse, the speculative opinions to tinker with Interest Rate (RBI Repo Rate) of the Nation in India, as there is a bimonthly MPC(Monetary Policy Committee) Meet of RBI (Reserve Bank of India, the Central Bank of the Nation) in the Offing to be held in the 1st Week of June 2026. 
Pragmatically looking at the current situation of the Nation in India, in my considered opinion as an Expert of the Nation, it is no time to tinker with the Interest Rate (Repo Rate of RBI) of the Nation in India. 

In the recent times, due to the West-Asia Conflict situation that has come through the War between US-Israel and Iran, that has resulted in Economic Crisis Globally due to instability of supply of Oil and Gas and its resulting volatility of the Prices of Oil and Gas along with disrupted supplies around the Globe, there is speculative statements even from several Central Banks of the World indicating interest rate hikes in case of aggressive and persisting inflationary pressures under their jurisdictions of geographies. Basing on such statements coming from several other Central Banks around the world, there is lot of speculation in India right now that RBI may tinker with its Repo Rate even at the MPC Meet of June 2026, such speculations are ill-founded. 
Let us Look at the hiked Repo Rate Cycle of RBI post Covid-19 Pandemic:
In 6-MPC meets Consecutively from May 2022 to February 2023, the Repo Rate of RBI was hiked as follows:
  • May 2, 2022: Increased by 40 bps to 4.40% (out-of-cycle meeting)
  • June 8, 2022: Increased by 50 bps to 4.90%
  • August 5, 2022: Increased by 50 bps to 5.40%
  • September 30, 2022: Increased by 50 bps to 5.90%
  • December 7, 2022: Increased by 35 bps to 6.25%
  • February 8, 2023: Increased by 25 bps to 6.50%
From February 2023 to January 2025 the above Highest Repo Rate of 6.5% of RBI was maintained continuously without Respite to the Nation and Indian Population, Commerce and Industry when the whole Nation was troubled a lot, in spite of the fact that the Popular Incumbent Government of India wished then that the Interest Rate of the Nation should come down, the Incumbent Hon'ble Union Finance Minister of India Her Excellency Ms. Niramala Sitharaman Ji, spoke in the public that the interest Rate of the Nation should come down, and the Incumbent Hon'ble Union Commerce and Industry Minister His Excellency Shri Piyush Goyal Ji, also spoke in the public that the interest Rate of the Nation should come down in the National Interest then in 2024, still the Repo Rate of RBI in 2024 remained non-relenting.  
Only after the just former RBI Governor was replaced and the Present Hon'ble RBI Governor Shri Sanjay Malhotra was brought in, in December 2024 then only the Repo Rate Cut Cycle of RBI was in sight in India and the Repo Rate of RBI has been decreased between February 2025 and December 2025 by 4-MPC Meets as follows:
  • February 6, 2025: Cut by 25 basis points (to 6.25%).
  • April 9, 2025: Cut by 25 basis points (to 6.00%).
  • June 6, 2025: Cut by 50 basis points (to 5.50%).
  • December 5, 2025: Cut by 25 basis points (final cut to 5.25%)
  • From December 2025, the RBI Reporate has been maintained at 5.25% as shown above, giving some respite to the Nation, its Common People, the Commerce and Industry by reducing it from the Highest Level of 6.5% to 5.25%. 
Yes, due to the West Asia Crisis, owing to the War between USA-Israel and Iran, there has been inflationary pressure that has arisen due to Disruption of Supplies of Oil and Gas and Steep Price Hikes in Crude Oil and Gas. India as a major importer of Crude Oil and Gas can not be an exception, however there has been certain price rise of Oil and Gas, however, that is very minimal and around 3-3.5% on the existing prices of oil and gas (finished products sold in the retail). However, the West Asia Crisis is under a Peace-Deal Negotiation, between the USA and Iran and it is almost towards its fructification as everyone is reading from the World's Public Media. Once and if this Peace Deal is formally accepted by the parties involved and the War gets halted, the situation of Oil and Gas Supply Disruption and Upward Price Trend may come back to normal pre-war levels quite sooner than expected. 
In such a scenario, it is really no time to think of tinkering the Repo Rate of RBI in the June-2026 MPC Meet of RBI, while the Nation has not even got the full Respite from the 6.5% of Repo Rate that was persistent for 3years putting the Nation into too much perilous situation prior to February 2025 and while the Nation has only got half respite from it by halting the Interest Rate Reduction cycle at 5.25% as of December 2025. 

Therefore, if not reducing the Repo Rate, as of June 2026 MPC-Meet that is forth coming in the next week, the RBI MPC may hold and maintain the Status Quo of the Repo Rate of 5.25% to do Pragmatic Wait and Watch for India as the Nation looking forward to the situation of the USA-Iran Peace Deal as to how it unfolds in the future and the situation unfolds in the Nation in the coming times. An artificial inflationary pressure caused by a Global Situation of a War which may be also temporary, it can not be tempting for the RBI MPC to jump to take a counter productive stand of Repo Rate that will not be in the National Interest, given the experience of higher interest rate that was persisting at 6.5% in the recent past for 3years giving lot of trouble for the Nation.


This is my Opinion as an Expert of the Nation in the National Interest of India and this opinion is very farm as far as I am concerned. 

With best regards,

Dr.Nimain Charan Biswal,
Mumbai, India.


About the Author : Dr. Nimain Charan Biswal is a B.Sc.(Agri. Science and Technology), M.B.A. and Ph.D.(Management Area ) by qualifications; and he has 40 years of work experience in Social, both industrial and Development sectors in diversified fields of Social Importance. He has been educated at Orissa University of Agriculture and Technology (OUAT)-Bhubaneswar, Institute of Rural Management Anand (IRMA) and Gujarat University (with Resource Support of IIM-Ahmedabad). He is further educated at IIM-Calcutta, XLRI-Jamshedpur, Apple Computer Industries and Spar Inc., USA. He has worked for reputed National and International Organizations in Senior/Top Management Capacities at Board level as well as Managing Director and CEO. He is a management expert covering extensive areas from management in Social Sectors, industrial sectors, management in Agriculture, Dairy and Foods, Agri-Food, Pharma, FMCG and Consumer Healthcare Sectors and Management of Cooperatives, Development Management to management of Public Systems. He is a prominent professional of India and known Internationally as well. He is also a Business and Political Strategist. He lives at Mumbai in India





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