SME Times News Bureau | 02 Jul, 2018
The
Reserve Bank of India (RBI) and the Finance Ministry should work in
unison to ensure that rupee does not face any more significant fall from
the current levels, as the country could then be subjected to 'imported
inflation' resulting from currency depreciation and rising crude oil
prices, the ASSOCHAM has said.
"We
are sure, the RBI and the Finance Ministry, helped by robust foreign
exchange reserves would step in at each volatility point to safeguard
the macro-economic stability," ASSOCHAM said.
It said while RBI has been rightly leaving the foreign exchange rates to
the market, it must step in at unusual times of uncertainty and
volatility, caused by a combination of geo-political factors such as the
US stand on the Iran nuclear deal, less than adequate raise in crude
production by the OPEC member countries and an overall pressure on the
Emerging Markets in the financial markets.
Besides,
the Commerce Ministry should also step in to ensure that the exporters
are facilitated to the maximum to push exports and the inward
remittances as the import demand for dollar rises up. The non-essential
imports can be curtailed and the trade deficit should be kept in check
and not be allowed to balloon.
The
ASSOCHAM also urged the Ministry of External Affairs to engage more
with the Non-Resident Indians while the RBI in consultation with the
commercial banks should devise more of the schemes for the NRIs for
inward remittances. "All channels of remittances should be explored and
used to the maximum so that the foreign exchange kitty remains stable."
To give a comfort level to
the Foreign Portfolio Investors, the SEBI, RBI and the Finance Ministry
should further simplify the rules for investing in the secondary debt
and equity markets.
"A
combined approach from all fronts is needed to remain on top of the
unfolding situation," the chamber said adding that macroeconomic
indicators should not be allowed to slip away. "We have been used a good
set of macro numbers and the same must be maintained."
ASSOCHAM
further said that 'fire power' of foreign exchange as emphasised by the
Economic Affairs Secretary, Subhash Chandra Garg should be resorted
to, sending strong signals to the global financial markets about
stability of the Indian markets.
