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Sr. | Items | Measures | Effective Date |
No.
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1
| 2
| 3
| 4
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1.
| Interest Rates
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a. | Bank Rate | Reduced from 8 per cent to 7 per cent. | April 2, 2000 |
| | | | |
| | | Raised to 8 per cent. | July 22, 2000 |
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b. | Fixed Rate Repos | Reduced from 6 per cent to 5 per cent. | April 3, 2000 |
| | | | |
| | | Replaced by Variable Rate Repo. | June 5, 2000 |
| | | | |
c. | Deposit Rates | Savings deposit rate on domestic and ordinary | April 3, 2000 |
| | | non-resident savings deposits as well as savings | |
| | | deposits under Non-resident (External) Accounts | |
| | | Scheme of scheduled commercial banks reduced | |
| | | from 4.5 per cent to 4.0 per cent. | |
| | | | |
d. | Non-resident Deposit | Banks given the option to choose the current swap | April 27, 2000 |
| | Rates | rates while offering FCNR(B) deposits. | |
| | | | |
| | | Banks permitted to offer differential rates of | April 27, 2000 |
| | | interest on NRE deposits on size-group basis on | |
| | | the lines of domestic term deposits. | |
| | | | |
| | | Banks permitted to offer differential rates of | April 27, 2000 |
| | | interest on FCNR(B) deposits on size-group basis | |
| | | subject to the overall ceiling rate. | |
| | | | |
e. | Lending Rates | Board of Directors of banks allowed to delegate | April 24, 1999 |
| | | powers to ALM Committee to fix interest rates | |
| | | on advances. | |
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| | | Banks allowed to operate different PLRs for | April 24, 1999 |
| | | different maturities. | |
| | | | |
| | | Banks allowed to offer fixed rate term loans | April 24, 1999 |
| | | subject to conformity to ALM guide lines. | |
| | | | |
| | | The rates of interest on the foreign currency | August 16, 1999 |
| | | export credits which were to be fixed with | |
| | | reference to ruling LIBOR were also permitted | |
| | | to be fixed with reference to EUROLIBOR/ | |
| | | EURIBOR, wherever applicable. | |
| | | | |
| | | Freedom to banks to charge interest rates without | October 29, 1999 |
| | | reference to PLR, in respect of i) loans covered | |
| | | by refinancing schemes of term lending | |
| | | institutions; ii) lending to intermediary agencies; | |
| | | and iii) discount of bills with a view to | |
| | | encouraging bills culture. | |
| | | | |
| | | Withdrawal of the interest rate surcharge of 30 | October 29, 1999 |
| | | per cent on import finance, in force since January | |
| | | 1998. | |
| | | | |
| | | Withdrawal of the prescribed minimum interest | October 29, 1999 |
| | | rate of 20 per cent per annum on overdue export | |
| | | bills. | |
| | | | |
| | | Banks permitted to offer all loans on fixed or | April 27, 2000 |
| | | floating rate basis provided PLR stipulations as | |
| | | applicable are complied with. | |
| | | | |
| | | An interest rate surcharge at 50 per cent levied | May 26, 2000 |
| | | on bank credit for imports as a temporary measure. | |
| | | | |
| | | The interest rate applicable for overdue export bills | May 26, 2000 |
| | | in case of export credit not otherwise specified | |
| | | (ECNOS) at post shipment stage prescribed at 25 | |
| | | per cent per annum (minimum). | |
| | | | |
f. | Advances against | Banks allowed to charge suitable rates of interest | April 24, 1999 |
| | Domestic/NRE/ | on advances against domestic/ NRE term deposits | |
| | FCNR(B) term deposits | without reference to the ceiling of the PLR in all | |
| | | cases where deposit rates are more than PLR. | |
| | | | |
| | | Freedom to banks to charge interest rates on loans | October 29, 1999 |
| | | against domestic/NRE (irrespective of repayment | |
| | | of loan in foreign currency or Rupee)/FCNR(B) | |
| | | deposits to the depositors without reference to | |
| | | their own PLR. | |
| | | | |
| | | Banks permitted to charge interest at suitable rates | March 23, 2000 |
| | | in case of advances up to Rs.2 lakh against third | |
| | | party deposits, as in case of advances to | |
| | | depositors against their own deposits. | |
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2.
| Reserve Requirements
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a. | Cash Reserve Ratio (CRR) | Reduced to 10.0 per cent. | May 8, 1999 |
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| | | Gold imported by authorised banks and lent to | July 31, 1999 |
| | | jewellery exporters in India for exports exempt | |
| | | from CRR/SLR. | |
| | | | |
| | | Liabilities under gold deposits mobilised in India | October 5, 1999 |
| | | exempt from CRR. | |
| | | | |
| | | Reduced to 9.5 per cent. | November 6, 1999 |
| | | Incremental CRR of 10 per cent (over the level | November 6, 1999 |
| | | as on April 11, 1997) on FCNR(B) deposits | |
| | | done away with. | |
| | | | |
| | | Reduced to 9.0 per cent. | November 20, 1999 |
| | | | |
| | | Inclusion of 'cash in hand' with banks for | December 1, 1999 to |
| | | calculation of CRR. | January 31, 2000 |
| | | | |
| | | Reduced to 8.5 per cent. | April 8, 2000 |
| | | | |
| | | Reduced to 8.0 per cent. | April 22, 2000 |
| | | | |
| | | Borrowings of gold mobilized under the Gold | May 6, 2000 |
| | | Deposit Scheme by authorised banks from other | |
| | | authorised banks treated as inter-bank liabilities | |
| | | and exempt from CRR. | |
| | | | |
| | | Minimum daily requirement of CRR balances | May 6, 2000 |
| | | reduced from 85 per cent to 65 per cent. | |
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| | | Raised to 8.25 per cent. | July 29, 2000 |
| | | | |
| | | Raised to 8.50 per cent. | August 12, 2000 |
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b. | Statutory | Remained unchanged at 25 per cent. | - |
| | Liquidity Ratio (SLR) | | |
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3.
| Refinance
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a. | Rate of interest on | Increased from 7 per cent to 8 per cent. | April 1, 1999 |
| | Export Credit | | |
| | Refinance (ECR) | | |
| | | | |
| | | Reduced to 7 per cent. | April 3, 2000 |
| | | | |
| | | Raised to 8 per cent. | July 22, 2000 |
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b. | Collateralised Lending | Replaced General Refinance Facility. Availment | April 21, 1999 |
| | Facility (CLF) | to banks limited to 0.25 per cent of the fortnightly | |
| | | average outstanding aggregate deposits in 1997- | |
| | | 98 (i.e. Rs.1,314 crore) and for two weeks at the | |
| | | Bank Rate. Provision of an additional | |
| | | collateralised lending facility (ACLF), also of | |
| | | Rs.1,314 crore, at the Bank Rate plus two | |
| | | percentage points. Imposition of a penal rate of | |
| | | 2 percentage points on CLF and ACLF availed | |
| | | for second block of two weeks. | |
| | | | |
| | | The stipulation of a two week cooling period at | October 6, 1999 |
| | | the end of four weeks of availment of CLF/ACLF | |
| | | by banks was removed. | |
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c. | Liquidity Support | Tier-I liquidity support (constant throughout the | April 21, 1999 |
| | Facility (LSF) | year) against collateral of government securities, | |
| | | based on bidding commitment and other | |
| | | parameters, available to PDs at the Bank Rate | |
| | | for a period of 90 days. Provision of Tier-II | |
| | | liquidity support against collateral of government | |
| | | securities to PDs for periods not exceeding two | |
| | | weeks at a time at the Bank Rate plus 2 | |
| | | percentage points. | |
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d. | Special Liquidity | Introduced to enable banks to meet any | December 1, 1999 to |
| | Support Facility | unanticipated additional demand for liquidity in | January 31, 2000 |
| | | the context of the century date change. Provision | |
| | | of liquidity to the extent of banks' excess holdings | |
| | | of Central Government dated securities/Treasury | |
| | | Bills over the required SLR at an interest rate of | |
| | | 2.5 percentage points over the Bank Rate. | |
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e. | Export Credit | Banks given the benefit of rediscounting export | May 6, 2000 |
| | Refinance Facility | bills with institutions like EXIM Bank and | |
| | | obtaining refinance from NABARD/EXIM | |
| | | Bank. | |
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f. | Liquidity Adjustment | The first stage of LAF introduced. ACLF to banks | June 5, 2000 |
| | Facility (LAF) | and Tier-II liquidity support to PDs replaced by | |
| | | variable rate reverse repo auctions. Fixed rate repo | |
| | | replaced by variable rate repo. | |
| | | | |
| | | Limits available to banks for all refinance | July 29, 2000 (Stage I) |
| | | facilities (including those for CLF) reduced | August 12, 2000 (Stage II) |
| | | temporarily to the extent of 50 per cent of eligible | |
| | | limits in two stages of 25 percentage points each. | |
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g. | Special Funds Facility | A special funds facility introduced for banks and | October 3, 2000 |
| | | PDs to provide intra-day funds to facilitate | |
| | | settlement of securities transactions in case of | |
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| gridlock.
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