Dubai debt crisis:India cautious,Sensex regains most of losses

New Delhi, Nov 27 (PTI) India on Friday reacted
cautiously to the financial crisis in Dubai, caused by debt
repayment crisis of a state firm, saying it would examine the
extent of the problem, but maintained that no impact was
visible as of now.

While the government exuded confidence that the crisis,
which pulled down the stock markets across the globe, should
not have any major impact on factors like employment and
exports, Reserve Bank said developments and the extent of the
problem need to be studied.
Having asked its officers to study the impact and make
necessary recommendations, Reserve Bank of India (RBI)
Governor D Subbarao said: "We should not react to instant news
like this. One lesson that we learnt from the (global
financial) crisis is that we must study the developments and
measure the extent of the problem and hence study the impact
on India."
Amid the reaction from global markets, Dubai government
promptly promised to pump in all necessary resources for
success of Dubai World, the state-owned investment holding
company whose request for postponement of USD 59 billion loan
repayment till May had triggered the latest crisis.
Indian stock market lost over 600 points in initial trade,
but recovered sharply and ended the day with a 223-point loss
as reassuring sentiments expressed by corporates, Finance and
Commerce Ministries as also RBI helped control the erosion.
Yesterday, the markets here had lost more than 400 points
amid a plunge in stocks across the world. MORE PTI TEAM
SKT


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