India does'nt need assistance IMF

Ulhas Joglekar uvj at vsnl.com
Fri Feb 14 17:18:31 PST 2003


Business Standard

Friday, February 14, 2003

India does'nt need assistance: IMF

Press Trust of India in New Delhi Published : February 14, 2003

The International Monetary Fund (IMF) today praised India for its "comfortable" foreign exchange reserves and said the country did not need any assistance from it.

"India does not need any financing from the IMF considering that it has $73 billion of forex reserves," the Washington-based multilateral institution's representative in India, James Gordon, said at a seminar on 'The role of IMF in India', organised by the Indian Institute of Planning and Management here.

With foreign exchange reserves of $73 billion within 10 years, Gordon said, "frankly, something must have been done right".

Considering that India's forex reserves could sustain 15 months import, Gordon said, "it is extremely comfortable".

India had last borrowed from the Fund during the balance-of-payments crisis in the early 1990s and since the country had repaid its loans, the IMF's role had been "considerably" scaled down.

"As of now, the IMF's role in India is that of surveillance," he said, adding that its surveillance had sharpened focus on economies vulnerable to crises.

On India's debt position, with a short-term debt of $10 billion and huge forex reserves, the IMF official said, "the short-term credit is not a big problem for India", even as he expressed concern over the rising proportion of internal debt to the gross domestic product and rising fiscal deficit. India's cautious approach on liberalising capital account convertibility also came in for praise from the Fund.

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