Credit offtake up 18% in 12 months to 18 Nov

Mumbai: The non-food credit has grown 17.8 percent to over Rs 43.20 lakh crore in the 12 months to 18 November, according to the Reserve Bank of India (RBI).

The offtake was Rs 36.65 lakh crore during the 12 months to 19 November, 2010.

The annualised credit growth, however, had been above the 19 percent mark from August.

[caption id=“attachment_145003” align=“alignleft” width=“380” caption=“deposits rose to over Rs 58.06 lakh crore as on 18 November. Reuters”] [/caption]

But, it declined to 18.5 percent during the fortnight ending 4 November which, experts said, was on account of the high interest rate regime in view of inflation.

RBI has raised key policy rates by 350 basis points through 13 hikes since March, 2010 to curb inflation, which has been above the 9 percent mark since December last year. The rate of price rise was 9.73 percent in October.

Meanwhile, deposits rose to over Rs 58.06 lakh crore as on 18 November, as against Rs 49.97 lakh crore as of 19 November, 2010. This is a growth of 16.2 percent.

In its first quarterly monetary policy review for FY'12 in July, RBI had said that credit growth was likely to slow down as a result of its rate hikes.

RBI said credit growth would be around 17-18 percent this fiscal, as against the earlier projection of 19 percent, while deposit growth has been pegged at 17 percent.

During FY 2010-11, bank credit offtake increased by 21.5 percent, while deposits grew by only 15.5 percent.

Indian industry has complained that the high interest rate regime has resulted in slowing down of investments and the industrial growth.

Economic growth slowed to a nine-quarter low of 6.9 percent in the July-September period. Besides, industrial growth has slowed to a two-year low of 1.9 percent in September.