Mumbai: India is better prepared to deal with any further U.S. Fed tapering, but the country needs to remain vigilant to face eventualities, Reserve Bank Governor Raghuram Rajan said today.
We have done a lot to make the economy robust and we are better prepared (to deal with impact of tapering). (But) I will never say we are fully prepared for any eventuality. We have to be vigilant.
Finance Minister P Chidambaram had chaired the full meeting of the Financial Stability and Development Council (FSDC) comprising all financial sector regulators.
The meeting took place against the backdrop of tapering of Quantitative Easing (QE) in the U.S., and the Reserve Bank revising the current financial year’s growth projection to less than 5%.
Last week, the U.S. Federal Reserve decided to cut its bond purchases further by another USD 10 billion. It has decided to purchase USD 65 billion per month of mortgage backed securities and longer-term treasury securities as against USD 75 billion per month earlier.
I have full faith that she will do whatever is appropriate and she will be very reliable central banker,the Governor said. Referring to the FSDC meeting, he said.
The government and regulators discussed a broad set of issues facing the economy and decided to move forward on some of issues, including non-performing assets.
As and when the precise measures (on NPAs) are determined, we will obviously announce them, Rajan added.
Bureau Report
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