With the aim of containing inflation, the Reserve Bank of India today raised its short-term lending and borrowing rates by 50 basis points, or 0.5 percent, each. Announcing its annual credit policy, the Reserve Bank increased its repo rate, or the rate at which it lends short-term funds to commercial banks, to 7.25 per cent, and its reverse repo rate, or the rate at which its borrows short-term funds from commercial banks, to 6.25 per cent. With this move, home, auto and other loans are set to become costlier. The RBI kept the Bank Rate and the Cash Reserve Ratio unchanged. The RBI also forecast GDP growth of 8 percent for the current fiscal, against the government's projection of 9 per cent. The apex bank has also forecast an inflation rate of 6 percent by March 2012. RBI Governor D. Subbarao said bringing down inflation, even at the cost of some growth in the short-run, should take precedence.The RBI, however, gave some relief to general depositors by increasing the savings bank rate to 4 per cent, from 3.5 per cent. The apex bank also made a strong case for increasing domestic petroleum product prices, in line with global crude oil prices. Meanwhile, Commerce and Industry Minister Anand Sharma today urged the banks to provide loans on easy interest rates to the industry. Reacting to the Credit Policy announced today, Mr. Sharma said that there should not be any escalation in RBI lending rates even after the policy.