NEW DELHI: Finance minister P Chidambaram said on Tuesday that banks have the scope to reduce interest and deposit rates even as the government strives to achieve growth with price stability. The government has asked banks to lend more to retail consumers, the finance minister said. In some states, nonperforming loans may be higher and the quantum of lending may differ from other states, though. “I have impressed upon banks to give more consumer loans. I am sure they will respond,” the minister said at an interaction with industry leaders organised by industry chamber CII. The government’s priority is to ensure “close to 9% growth and close to 4% inflation”, for which there is no easy policy prescription, he said. “In some years, we may succeed, in some others, we may not. But the effort is to achieve this,” Mr Chidambaram said. He added that the government has privately communicated its views on interest rates to the Reserve Bank of India, which would take a final call on the issue. RBI has raised interest rates nine times since October 2004 and asked commercial banks to park more deposits with it five times since December 2006 in a bid to check excess money supply fuelling inflation. Inflation is now at an eight-month high of 4.89%. Mr Chidambaram also said that there is scope for stake sales in state-run companies. He said the Budget had factored in possible wage increases for government employees, which the Pay Commission may recommend in its report, expected by March 31. The minister said he would look into whether it would be possible to extend the benefit of textile upgradation fund administered by the textiles ministry to technical textiles, a product that comes under the chemicals and fertilisers ministry. He also said the government would reduce inverted duty structure in different sectors as far as possible, although it is not possible to remove it completely. He said the benefit of set off announced on dividend distribution tax to the holding company would not be extended to other shareholders.