New Delhi, Aug 25 (): Indian Finance minister, Chidambaram told banks to help exporters and assured FII of the moves taken to bring in money when US stops the economic stimulus. A meeting with the bankers and FII was held in Mumbai on Saturday. After the two meetings with representatives of foreign institutions and banks, Finance Minister said that the government was taking measures to attract more deposits and fast-track clearances of big projects.
Aravind Mayaram, secretary, economic affairs who spoke to the media after the meeting said the Government was ready to face a situation when FII pulls out after US fed stops bond buying. FDI investment will be strong and PSU would float semi governmentt bonds worth $12 million.
Chidambaram, who attended the meetings along with Mayaram and Rajiv Takru Financial Services Secretary was seeking feedback from participants on their views on India’s financial markets and the economy. FII wanted to know as to the steps to contain CAD and bring in investments. FII were told by Chidambaram that the steps to control CAD was lost in the stock market and rupee decline worry.
The coming quarter will show the results. Suuti formerly UTI holds shares in Axis Bank, L&T and ITC. The government will go in disinvestment in Suuti. Broking firms and banks like Citi and Deutsche took part. Morgan Stanley and Goldman Sachs were also present.
FII wanted limits on debt to be scrapped, listing on global debt index of JP morgan. If US bonds yields gets harder than FII outflow will increase.
Chidambaram was talking to banks which had offices overseas and holding FCNR and NRE accounts. The bankers said that cuts in indirect and direct tax for exporters would be helpful and they were treating exporters as top priority to bring in capital inflows. Last month 23 big infra projects were cleared and nine are coming before the Cabinet for clearance. In ten days more reforms could be seen said Aravind Mayavram.