RBI, govt will pull out all stops to deal with taper impact: Finmin

Written by fe Bureau | New Delhi | Updated: Jan 31 2014, 05:35am hrs
The government and the Reserve Bank of India will do everything to ensure that the latest round of stimulus draw-down by the US Federal Reserve will not have a major impact on India, said a statement issued by the finance ministry on Thursday. The Fed said on Wednesday it would buy $65 billion in bonds per month starting February, down from $75 billion now. The announcement sent markets into a tizzy, with the BSE Sensex plunging 300 points before recovering a little, and the rupee going as low as 62.90 versus the dollar before closing at 62.56. As the government has stated earlier, Indias economy is better prepared for the consequences, if any, of the taper. We have added to our foreign exchange reserves, which stand at $295 billion. The current account deficit, earlier estimated at

$70 billion, is now expected to be below $50 billion in 2013-14, the statement by the finance ministry said.