Rising inflation is a cause for concern, but credit growth is also rising as a positive sign for the economy. While credit to industry hit a record high of Rs 31.82 lakh crore in July due to increased demand for project finance and working capital, retail credit also surged.

Credit to the industry remained stagnant at around Rs 28-29 lakh crore per month in 2020 and 2021. The industry comprises 27.7% of the total non-food credit. According to reserve Bank of IndiaIn July data on sectoral credit, credit to industry expanded 10.5 per cent year-on-year – the highest in the past eight years.

“Usage of existing sanction limits and reappraising in some sectors has led to industry credit going out of the range of ₹28-29 lakh crore during the last three years.” Kunal ShahAnalyst and

, “We believe that a revival in consumer demand (and) an increase in private capex, followed by an increase in government spending, could be a potential trigger for industry credit growth, and inspired Overall credit growth revival.”

Bank loans registered a growth of 15.1% in July, compared to 5.1% a year ago as large corporates moved back to banks. According to RBI data, credit to large industry grew by 5.2% in July, from 3.8% a year ago. Medium industries registered a credit growth of 36.8% from 59% in July 2021, while credit growth to micro and small industries increased from 10.5 per cent to 28.3 per cent during the same period.

“We are certainly in talks with Corporate India on capacity utilization, especially in the areas of specialty chemicals, cement, renewable energy,” it said. Rajeev AnandDeputy Managing Director A.T.

, “Will all of them be financed by banks? Probably not, as Corporate India’s operating cash flow has improved, they are quite happy to use internal accruals to create new capacities,” he said.