Don’t panic, trust economy’s strength, Jaitley tells investors

Tribune News Service

New Delhi, February 12

In a damage-control exercise following the steep fall in markets, Finance Minister Arun Jaitley today asked investors to look at the inherent strength of Indian markets rather than focusing on globally triggered issues.

Jaitley said in the past few days there has been a major selloff in markets which created a chain reaction and India was also affected.

Given the scare on bad loans in public sector banks, the Finance Minister said the government is committed to protecting the banks and give them the capital requirements. “Bad loans are there but banks are equipped to deal with these issues. Problem must not be exaggerated,” he added.

The Sensex fell by a whopping 807 points yesterday.

The Finance Minister attributed the fall to global choppiness. “There could be several reasons, which are predominantly outside the country, the uncertainty in the Fed rate or what’s happening in Europe or the slowdown anticipated in China. Now, these global factors will remain and will have to be tackled globally by those economies,” he said.

“There need not be any exaggerated panic in India for the reason that India as an economy even in the midst of global slowdown has clearly stood out to maintain a 7.5% plus growth rate,” Jaitley said.

Terming non-performing assets as a problem, Jaitley said the government is considering more steps to empower banks to recover bad loans and the problem will be contained soon. “These are the loans which were given earlier by these banks and as a part of prudent policy it has been considered that the balance sheets should be transparent. The banks are going to take all steps possible to recover the loans from debtors,” he said.

Pointing to some over-reactions to reports in the section of media with regard to the state of the public sector banks, Jaitley said, “In any case the volume and extent of the problem should not be exaggerated so as to lead to any panic.”