Processing .....please wait.. 
The article has been forwarded.... 
Is India a safe haven during recession?
By siliconindia
|
Wednesday, 10 August 2011, 00:39 IST |
25 Comments
Economic experts suggest that India could become the global safe haven even if the economic downturn persists. "In the next months and in the medium-to-long run, there will be global capital in search of safe haven, we can become the safe haven that a lot of global capital will be seeking," said Kaushik Basu, Chief Economic Adviser. He also added that the thrust of the world economy will shift towards the eastern part of the globe including India and China.
The Federation of Indian Chambers of Commerce and Industry suggested that India will be impacted in the short term because of the U.S. debt crisis, but it will also benefit from the economic turmoil as softening crude prices will bring down inflation, prompting the RBI not to hike rates.
Reviewing the global economic situation and its possible impact on the country, Finance minister Pranab Mukherjee said that India's fundamentals are strong and the country is in a better position than other nations to meet the challenge.
As the price of crude oil and other global commodities are declining, the pressure on inflation is likely to ease. The stock market collapse on Monday was seen as a panic reaction to the S&P's downgrading of U.S. debt rating and an immediate policy intervention is not warranted at this juncture.
