Finance Minister P. Chidambaram Thursday asked Indian financial sector regulators to take concrete measures to avoid any adverse impact of the US stimulus tapering, saying it is likely to happen sooner or later.
Addressing the eighth meeting of the Financial Stability and Development Council (FSDC) here, Chidambaram said the "opportunity available due to the postponement of the reversal of the monetary policies in advanced economies should be utilised to further address the macroeconomic imbalances".
During the meeting, Chidambaram emphasised that tapering off of Quantitative Easing (QE) in the US is likely to happen sooner or later and, as such, regulators must take all possible concrete measures to avoid any adverse impact on the Indian economy, an official statement released after the meeting said.
Top financial regulators, including Reserve Bank of India governor Raghuram Rajan, finance secretary R.S. Gujral, economic affairs secretary Arvind Mayaram, financial services secretary Rajiv Takru, and Securities and Exchange Board of India (SEBI) chairman U.K. Sinha, attended the meeting chaired by the finance minister.
The US Federal Reserve last month surprised the markets by deciding to continue with monthly $85 billion bond-buying programme, known as Quantitative Easing (QE) intact, after nearly three months of speculation that had battered the Indian as well as other emerging markets currencies and stocks.
According to a statement released by the finance ministry, the FSDC deliberated on the implementation of the recommendations of the Financial Sector Legislative Reforms Commission; impact of tapering off of the Quantitative Easing in the US and preventive measures to be taken, among other things.