Mumbai, Aug 20 () : Corporate houses are upset as Sensex once again tanked by 300 points in the morning trade and rupee was headed to reach 65.
With negative sentiments in the market, India‘s top companies with exposure to foreign exchange markets such as Tata, Birla, Reliance Industries, Essar and Adani group are worried about the rupee fall as it could affect the operating costs. They are now redrawing the strategy towards currency risk. Many top corporate houses are now voicing the concerns that BJP leader and ex-Finance Minister Yashwant Sinha expressed yesterday.
Corporate house Bajaj Auto Chairman Rahul Bajaj said he was not surprised with the present condition as there has been no reform in the past four years. NREGA scheme and loan waivers and now food security scheme have all taken its toll on the budget. Bajaj said that the populist schemes were like ignoring the disease and attending to the symptom.
Yet another corporate boss Anand Mahindra of Mahindra & Mahindra said that RBI has taken the economy to 80s by capital control and there is no parachute to slow down the rupee fall. The PM met India Inc in July end to hear out ways to tackle rupee fall.
As reported yesterday, Rs 10,000 lakh crore projects are waiting for clearance. Now around Rs 1000 lakh crore worth projects have been cleared. This inaction has driven away infrastructure companies from India.
RBI’s latest move to control money being invested abroad seems to have no effect on the rupee. Infosys S Gopalkrishnan feels the import of iron ore and coal should be stopped.
India has coal reserves but Coal India is not able to tap them successfully. Coal Ministry is caught in an allocation scam. Short term capital gains tax has to be removed for FII investment.
Another worry is global oil prices going up which will lead to fuel price increase and thereby create inflation. Power companies are importing coal on loans borrowed from abroad and this makes them face a situations of default.
The CEOs told PM that when Indian made cars are lying unsold, the import of vehicles is going on. Electronic goods import bill is $31.5 billion and most of them are cheap stuff from China.