Search the Internet          Tips  Sites: Finance, Investment

India can't escape difficult situation facing global economy

Union Finance Minister Yashwant Sinha said on Saturday that India can not escape the difficult situation facing the global economy in the wake of the terrorist attacks on the US, asserting that 'harsh steps' will have to be taken to meet the consequences.

"The situation in the entire world is very grave and it will have a telling impact on the Indian economy," Sinha told reporters in Hazaribagh in Bihar.

Without going into details of the steps India intended to take to handle the situation, Sinha said, "The developments in the US have already hit the world economy and India cannot be an exception."

"It is an alarming situation as stock exchanges in America have closed down for five days now....nobody can say what will happen when they reopen on Monday," he said, adding that heavy drawing of money by top US companies having big stakes in India had shaken the stock markets here with the Bombay Stock Exchange Sensex plunging sharply.

Sinha said if the OPEC nations did not support the US in its fight against the terrorist organisations responsible for the attacks in New York and Washington and increased the price of crude oil, the oil prices would go up steeply worldwide and India would not be left untouched by it.

However, Sinha said that Indian foreign exchange reserves at $45 billion were sufficient to cushion the impact of a possible recession.

Extending full support to the US in its endeavour to bring justice those responsible for pulling down the twin towers of the World Trade Centre and attacking the Pentagon, the minister underscored the need for evolving harsher laws to tackle international terrorism.

"The US has realised the dangerous consequences of terrorism only after falling victim to it. India has always supported a global effort to combat this biggest menace of the modern times," he said.

Sinha said the US wish-list to Pakistan President, Pervez Musharraf had put him in a tight spot as the Pakistani leader faced isolation.

''It is time that Islamabad followed the right track and backed anti-terrorist efforts of the US in the larger interest of global peace," he said.

The Attack on America: The Complete Coverage

Tell us what you think of this report