No Plan for Curbs on FII, FDI: Pranab .

WASHIGTON: Finance Minister Pranab Mukherjee has made it clear that India is not contemplating any restrictions on foreign institutional investment (FII) and foreign direct investment (FDI) at this point of time.

The Reserve Bank of India, however, would keep a watch on the market situation and take appropriate action as and when necessary, he said during a Q A at the Woodrow Wilson Centre here.

"I do not consider it's going to be too volatile at the present situation. But definitely, it is the responsibility of the central bank of any country to watch the situation and, as and when necessary, to intervene appropriately,"

he said.
Alluding to the inflow of capital, Mukherjee said he did not reckon it was going to be all that volatile as of now, adding it "has not distorted market sentiment and therefore there is no question of putting any curbs."

In reply to another question, he expressed the hope that the steps taken by the government and the RBI would help bring the inflation level to about 6 per cent by the end of the financial year.

"We have taken steps to improve the supply side by easing import of foods, which are in short supply," he said, adding that on the demand side, the latest revision of interest rates would help mop up excess liquidity.

He said the government's effort would be to strike a balance so that inflationary pressure is reduced without retarding growth.

Earlier, speaking on the theme of IndiaUS partnership in the emerging global economic architecture, Mukherjee said that India is now an open, competitive market economy whose engagement and integration with the global economy has been growing rapidly.

Trade between India and the US has more than doubled between 2004 and 2008, with both trade in goods and services being broadly balanced.

Indian companies have invested over $25 billion in the US over the past five years, creating jobs and prosperity, just as US companies have been doing in India, he said and added that the opportunities for business engagement with India will multiply manifold.

"Sustained high growth will catapult India into one of the three largest economies in the coming decades. The Indian economy will be one of the nodes of global economic momentum and stability," he said.

Source : expressbuzz.com