Terming today's market crash as "transient and temporary", Finance Minister Arun Jaitley said both the government and RBI are watching the situation and hoped it will stabilise as domestic macroeconomic indicators remain strong.
Jaitley attributed the biggest ever drop in the benchmark Sensex to external factors and said that India is among the fastest growing economies of the world and the government is taking steps to further strengthen it.
"There has been for the last few days a great amount of turbulence in the global markets. Obviously, that turbulence has had impact on Indian market itself. The factors responsible for this are entirely external.
"There is not a single domestic factor in India which has either contributed or added to it. These are external factors. I have not the least doubt that this turbulence is transient and temporary in nature. Markets will settle down", he said.
In the worst-ever crash in stock markets, Sensex today plunged by 1,624.51 points at 25,741.56 -- its lowest level since August 2014 -- and nearly Rs 7 lakh crore got wiped out from the investors' wealth.
Besides, the rupee today fell most in 23 months to hit a two-year low at 66.64 against the US dollar.
Speaking earlier in the day, RBI Governor Raghuram Rajan said the central bank has resources to deal with the rupee volatility.
The government and RBI are closely watching the situation, Jaitley said, adding that efforts would be made to further strengthen the economy to deal with the impact of global developments.
"Our fiscal deficit figures are under control. Inflation is very much under control. We stand by the growth projections which we made at the beginning of the year and indirect taxation data actually supplements the idea of those projections," he said while addressing a conference of Chief Commissioners and Director Generals of Customs, Central Excise and Service Tax.
