Prime Minister, Dr. Manmohan Singh assured Lok Sabha that Indian banking system is stable and people's deposits with public and private banks are entirely safe. He ruled out any direct impact of global financial crisis on the Indian economy but he confessed its indirect impacts on the country growth.

Government is taking various steps to galvanize India from the global slowdown. Indian banks are financially very sound and they have very small exposure to the sub-prime mortgage assets. So people no need to worry about their money.

The government is taking various steps to ease the liquidity situation in the country. Now, the Reserve Bank of India (RBI) cuts rapo rates after successive cuts in the cash reserve ratio (CRR). The apex bank slashed rapo rates by 100 basis points. This is the step against the tight monetary policy adopted by the central bank. It is the first ever reduction in the rapo rates after March 2004. Rapo rates now stands at 8 percent.

The banks also started to slash the interest rates for consumers after revision of rapo rates. The fifth-largest state-owned bank, Union Bank of India reduced interest rates on home loan by 50 basis points up to a loan Rs 30 lakh.

New Delhi, Oct. 20 : The Confederation of Indian Industry (CII) has welcomed the Reserve Bank of India’s decision to cut the repo rate by 100 base points to bring it down to eight percent.

Director General of CII Chandrajit Banerjee described the announcement as a step in the right direction.

"We are thankful to the RBI Governor for agreeing to this suggestion made by CII in view of the credit crisis that was starting to manifest in the Indian system, following the global liquidity crunch," he said.