'India may escape world slowdown'

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New Delhi, January 17:: could lose public support ahead of elections.

The report said pressure on the rupee to appreciate was likely to continue in the immediate future and it urged the government to provide clear signals to enable industry to adjust to a higher exchange rate environment through productivity increases and by tapping the booming domestic market.

It said the approach to dealing with the exchange rate for the rest of 2007/08 would be continued intervention, accompanied by adequate sterilisation.

The RBI bought $7.83 billion in intervention in November, when the rupee tested a near-decade high of 39.16 versus the dollar, data showed on Wednesday.

The Reserve Bank of India has been buying dollars heavily to slow down the rupee, which climbed more than 12 per cent in 2007 to be one of Asia's best performing currencies.

Foreign portfolio flows of $17.4 billion into stocks and about $2.3 billion into debt in 2007 put upward pressure on the rupee.