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RBI Governor hints at interest rate cuts

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By NewsGram Staff Writer

Washington: RBI Governor Raghuram Rajan has hinted at cutting interest rates for a fourth time. He admitted that the continuous slow economic growth has become a central problem world over.

“We’ll look at the data as it comes in and take a further view. We have not said we are finished,” he said in an interview with CNBC television in Jackson Hole, Wyoming, where he’s attending an economic symposium.

After cutting its repo rate by 75 basis points this year, the RBI kept the rate on hold at its last policy review, saying it wanted to monitor inflation and wait for lenders to further lower their lending rates.

The RBI, Rajan said, has reached an agreement with the government on a new monetary policy committee that largely meets the goal of transitioning from a system where the governor alone is responsible for decisions in order to insulate it from outside pressure, he said.

The agreement on the new rate setting panel was different from a proposal circulated in July that would allow the government to appoint the majority of members.

“There’s an agreement with the government, which is not that plan,” Rajan said. He didn’t give more details.

The committee would replace the current rate-setting system once the RBI Act of 1934 is amended in parliament.

Having a committee would make it easier for individuals to resist pressure and ensure that “monetary policy doesn’t change overnight” if one person drops out, Rajan said.

“We also need a transition path from where we are now to that committee,” he said. “It can’t be that overnight the committee takes over and nobody understands what the views of the committee are.”

Rajan said that he sees a “mood of optimism” in India’s economy and that the nation is relatively insulated from a slowdown in China.

He called for lawmakers to overcome their differences to implement a goods and services tax, which he said, would be “one of the most important changes in India”.

He also said a proposed bankruptcy code would also be “extremely important“.

“If we can get a good bankruptcy code, we can start issuing long-term bonds, which is absolutely necessary to finance infrastructure, finance all the big things the government plans,” Rajan said.

He also cautioned the US federal reserve on going ahead with a rate hike, especially at a time when world economic growth is stalling which has led to massive volatility in currency, equity and commodity markets.

“My position over time has been don’t do it when the world is in turmoil,” Rajan told CNBC. “It’s a long anticipated event, it has to happen sometime…everybody knows it has to happen..but pick your time.”

Earlier on Friday Federal Reserve Vice Chairman Stanley Fischer told CNBC that it was too early to tell whether volatility in the market made it more or less compelling to raise rates at the central bank’s mid-September policy meeting.

(With inputs from IANS)

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India Continues Engaging With USA Over H-1B Passport Issue

India is closely engaged with the US administration as well as the US Congress on this matter.

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As Trump proposes changes in H1-B visa, India continues to engage with US

India is continuing to engage with the US over the H-1B visa, largely availed of by Indian IT companies, after the Trump administration proposed changes to the programme, a senior official said on Thursday.

“It is a very important topic for us and that is the reason why we have time and again at various levels, we have taken up this matter with the US side,” External Affairs Ministry spokesperson Raveesh Kumar said in response to queries by journalists here.

Kumar said that most recently, the issue was raised during the first ever India-US 2+2 Ministerial Meeting held here last month that was attended by External Affairs Minister Sushma Swaraj, Defence Minister Nirmala Sitharaman, US Secretary of State Mike Pompeo and Defence Secretary Jim Mattis.

On Wednesday, the US Department of Homeland Security (DHS) said that the US Citizenship and Immigration Services (USCIS) plans to come out with its new proposal by January 2019.

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It will also “revise the definition” of employment and employer-employee relationship to “better protect” US workers and wages Flickr

The DHS said it was also proposing to remove from its regulations certain H-4 spouses of H-1B non-immigrants as a class of aliens eligible for employment authorisation.

The move to end the rule could have an impact on more than 70,000 H-4 visa holders, who have work permits.

The H-4 visas are issued by the USCIS to immediate family members (spouse and children under 21 years of age) of the holders of H-1B visa.

The DHS said it will propose to revise the definition of speciality occupation to increase focus on obtaining the best and the brightest foreign nationals via the H-1B programme.

It will also “revise the definition” of employment and employer-employee relationship to “better protect” US workers and wages, the DHS said.

Donald Trump, India
President Donald Trump speaks about immigration alongside family members affected by crimes committed by undocumented immigrants, at the South Court Auditorium on the White House complex, June 22, 2018, in Washington, VOA

In his remarks on Thursday, Kumar said that India is closely engaged with the US administration as well as the US Congress on this matter.

Stating that there are certain bills which have been introduced, he, however, said that “it is important to note that none of these bills have been passed so far”.

“When we have engaged with the US, we have emphasised that our partnership which we have in the digital sphere have been mutually beneficial,” the spokesperson said.

Also Read: USA And Other Countries Pledge To Eradicate Illegal Wildlife Trade

“We have highlighted the role which has been played by the highly skilled Indian professionals who have actually contributed to the growth and development of the US economy,” he stated.

“And also they have helped the US to maintain a competitive edge in the world towards innovation and science and technology.” (IANS)