India's economic problems, including a wide current account deficit that has pushed the rupee to record lows, cannot be compared to the country's 1991 balance-of-payments crisis, the World Bank's chief economist Kaushik Basu said in a lecture in New Delhi on Monday
Basu cited a raft of economic data to show that the current situation was healthier than that of 1991, describing such comparisons as a "non question."
Speaking on the weakening rupee, which hit record low of 62.46 against the dollar on the same morning, Basu said India should use foreign exchange reserves to help stabilise the rupee.
When asked whether India needs to seek a line of credit from the International Monetary Fund (IMF) to help fix the economy, the economist answered "I don't think that we are in a situation where there is any need for that. India has enough foreign exchange reserves, so the question of having to turn to the IMF is not there."
The rupee fell despite a series of measures unveiled last week to try to stall its decline. The rupee has been the worst performer in Asia since late May, when the U.S. Federal Reserve first signaled that it may begin tapering its monetary stimulus this year, sparking an exodus of cheap money from emerging markets worldwide.
Copyright: Thomson Reuters 2013
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