New Delhi, Aug. 28: Asserting that there is no need to panic, Economic Affairs Secretary Arvind Mayaram today described the sharp fall in the value of the rupee as a reflection of “irrational sentiment”.
“This is an irrational sentiment. It will correct itself. It is important to stay on the course. There is no need to panic,” he told media here.
Mayaram, who was responding to a query on the value of the rupee, also attempted to assure the investors, saying the Current Account Deficit (CAD) in 2013-14 will be much lower than expected.
“CAD will be much lower than expected. We have already seen some moderation in CAD,” he said.
The rupee plunged to a new record low of 68.75 per dollar in the late morning trade on persistent dollar demand from banks and importers due to further fall in equity market amid rise in crude oil prices.
Finance Minister P. Chidambaram had earlier on Tuesday suggested a 10-point formula to revive the country’s economic situation, and sought co-operation from all quarters despite ideological and political differences.
Chidambaram, who was replying to a discussion on the country’s economic situation in the Lok Sabha, said the country needs more reforms, lesser restrictions and an open economy.
The Finance Minister said the fiscal deficit would be contained at 4.8 percent of the GDP even after doling out subsidies for the implementation of the Food Security Bill.
He said the government is doing everything to boost investment.
The Finance Minister also underlined the need to encourage manufacturing in sectors like power, steel, automobiles and textiles.
“We must increase production of electronics and textiles. We are importing things which we should not have imported. India can be strong only if we have a strong manufacturing economy,” he said. (ANI)