Despite the Dalal Street massacre leading to widespread panic, the government is likley to adopt a wait and watch policy before deciding on any possible course of action. It has decided not to launch any investigation immediately.
Finance minister P Chidambaram said that the fundamentals of the Indian economy is still very strong. “Worries of western world should not be allowed to overwhelm us… our economy is very different from some economies of developed countries. Our economy is a strong economy and the corporate sector is very strong,” he said.
?What is happening in the Indian stock markets seems to be a reflection of the heavy selling in Asian markets,? a finance ministry official said. The situation does not point to any foul play, he said adding that most stock markets across the world have been witnessing a similar turn of events in the face of fears of a US recession.
The standing committee on finance in 2006 pointed out that there could be some manipulations on intial public offers (IPOs) launched during that year.