Prime Minister Manmohan Singh on Saturday ruled out the possibility of India witnessing a repeat of the 1991 balance of payments crisis and also reversing the path to globalisation of the economy.
“There is no question of going back to1991 (balance of payment crisis). At that time foreign exchange in India was a fixed rate. Now it is linked to market. We only correct the volatility of the rupee,” he said.
In 1991, Dr. Singh said, the country had only foreign exchange reserves for 15 days. “Now we have reserves of six to seven months. So there is no comparison. And no go question of going back to 1991 crisis.”
Against the backdrop of the high Current Account Deficit (CAD) the Prime Minister was asked about fears in some quarters that the country may be witnessing a throw back to 1991 crisis when gold was pledged and the country was forced to adopt a reforms programme that put it on the path of globalisation of economy.
He was speaking after release of the fourth volume of RBI history titled “RBI History-Looking Back and Looking Ahead” at a small function at his Race Course residence.
When asked that the Current Account Deficit was still high, Dr. Singh acknowledged the problem saying high imports of gold was one of the major factors contributing to it.
“We seem to be investing a lot in unproductive assets,” he added.
He then turned to a leading economic journalist and said, “Ask him. He is the guru.”
You have reached your limit for free articles this month.
Subscription Benefits Include
Today's Paper
Find mobile-friendly version of articles from the day's newspaper in one easy-to-read list.
Unlimited Access
Enjoy reading as many articles as you wish without any limitations.
Personalised recommendations
A select list of articles that match your interests and tastes.
Faster pages
Move smoothly between articles as our pages load instantly.
Dashboard
A one-stop-shop for seeing the latest updates, and managing your preferences.
Briefing
We brief you on the latest and most important developments, three times a day.
Support Quality Journalism.
*Our Digital Subscription plans do not currently include the e-paper, crossword and print.
A letter from the Editor
Dear subscriber,
Thank you!
Your support for our journalism is invaluable. It’s a support for truth and fairness in journalism. It has helped us keep apace with events and happenings.
The Hindu has always stood for journalism that is in the public interest. At this difficult time, it becomes even more important that we have access to information that has a bearing on our health and well-being, our lives, and livelihoods. As a subscriber, you are not only a beneficiary of our work but also its enabler.
We also reiterate here the promise that our team of reporters, copy editors, fact-checkers, designers, and photographers will deliver quality journalism that stays away from vested interest and political propaganda.
Suresh Nambath
Please Email the Editor