On the day Dalal Street witnessed a carnage following China’s economic worries, Finance Minister Arun Jaitley tried to soothe frayed investor nerves by giving a pep talk on the economy and declaring that ‘the turbulence is temporary’. He said the Indian economy is on track and held external factors responsible for the current state of the market.

“Our fiscal deficit figures are under control. Inflation is very much under control. We stand by the growth projections which we made at the beginning of the year, and indirect taxation data actually supplements the idea of those projections,” he said while addressing a conference of Chief Commissioners and Director Generals of Customs, Central Excise and Service Tax. The government has projected the economy to grow between 8.1 and 8.6 per cent during the current fiscal.

Later, speaking to the media, he said since the past few days, there was a great amount of turbulence, which has had its impact on the Indian market. “The factors responsible for this are entirely external, there is not a single domestic factor in India that has either contributed to it or added to it. Now, these are external factors, I have not the least doubt that this turbulence is transient and temporary in nature. The markets will settle down,” he added.

Close watch He said the authorities concerned, be it the government or the Reserve Bank of India, are watching the situation very closely. The government’s response at this stage is very clear, and that is to strengthen the economy, he said. “We have embarked on a path for one and quarter years that even in the midst of global slowdown, India should emerge as one of the fastest growing economies in the world. I am glad we are doing that. Most of our domestic indicators are extremely positive and, therefore, I have no doubt that once these transient trends are over, the markets in India will settle down” he said.

Jaitley indicated that the central bank will continue to make interventions in the forex market to stabilise the rupee.

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