Under increasing pressure to cut interest rates on Employees Provident Fund, the labour ministry is expected to meet the Reserve Bank of India brass in a bid to retain the current rate of 9.5 per cent.
"We may have to have a meeting with Reserve Bank of India along with finance ministry officials. In the last meeting with Finance Minister Jaswant Singh, a suggestion was that there should be a meeting with RBI," Labour Minister Sahib Singh Verma said on Friday.
He said as of now there has been no move to cut the interest rates on EPF and no communication to that effect has been received from the finance ministry, adding: "If we continue to get the same rate of interest on what we had invested earlier, then may be that we continue with 9.5 per cent (the current rate)."
Asked whether such a rate cut is likely if there is any sizeable impact due to the proposed one per cent cut in interest rate on special deposit scheme, Singh said he was collecting the details and was yet to talk to the finance minister, as there was no communication to his ministry so far.
It is to be noted that over three-fourth of the investments of EPF go into SDS and any cut in interest rate on SDS would mean cut in EPF rates in the days to come.
The finance ministry has been persuading the labour ministry to cut the interest rate on EPF in view of declining rates in the economy, but Verma guarded his position saying the 'wise' investment decisions taken earlier has enabled his ministry to offer the current rate of 9.5 per cent.
Taking cue from soft interest rate regime, the Centre had earlier aligned the interest rates to yields from government securities.
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