| The government will not hesitate to take more measures, if required, to curb surging capital inflows without hurting growth, Finance Minister P Chidambaram told reporters outside his North Block office. |
| The finance minister, who returned today from a visit to the United States and Norway, added that any such steps would have to wait for an analysis of the results of the new controls placed on participatory notes (P-notes) that came into effect from today. |
| "I have said one of the concerns is a very strong increase in capital flows. Without hurting investment, we would like to take some measures to moderate inflows. Some measures have been taken by the Securities and Exchange Board of India (Sebi). We would like to wait and see what their impact is on capital inflows," Chidambaram said. |
| Chidambaram added that Sebi's moves had also "achieved the objective of greater transparency". |
| P-notes are securities linked to equities that are used by investors who cannot trade directly in the Indian markets. Sebi has imposed controls on P-notes to stem surging capital flows and make them more transparent. |
| Sebi has estimated that P-notes now account for more than half the investments by foreign institutional investors (FIIs). |
| The Reserve Bank of India (RBI) had also recently recommended curbing capital inflows to sensitive sectors like real estate. |
| In August this year, the government put fresh curbs on raising external commercial borrowings that linked borrowings to the use of funds and subjected inflows for rupee expenditure below a certain level to central bank approval. |
Top Section
Explore Business Standard