Sri. Pranab Mukherjee,
Honble Minister for Finance
Government of India
(pkm@sansad.nic.in)
Sir,
I am writing on behalf of the over seven hundred members of Mysore Grahakara Parishat (a registered consumer organization of Mysore, Karnataka) and countless other citizens of our country about the meagre interest rates on bank deposits.
1.The maximum rates of interest being paid by banks is 7½-8% (for deposits of 10 years) and 3-3½% (for savings accounts). But the current inflation is more than 12%. As a result, depositors are losing purchasing power heavily.
2.In developed economies, interest rates normally equal the inflation rate. For example, in the US where the current inflation rate is about 1.1%, the interest rate on CDs exceeds the inflation rate for periods longer than 15 months.
3.Public sector banks in India have made record profits this year. Bank profits should not be at the expense of the poor and the middle class depositors.
4.This approach of squeezing the poor and the middle class to increase profits deserves your urgent attention. The government should take immediate steps to increase the bank interest rates to at least nullify inflation.
We look forward to your reply so that its contents may be circulated to our members and to other members of the public.
Yours sincerely,
Maj.Gen. (Rtd.) S.G.VOMBATKERE
President
Mysore Grahakara Parishat,