No need to press panic button following Dubai debt spark, says Mukherjee - India News and Travel Times Provides India-centric and other News and Features

Indian Finance Minister Pranab Mukherjee said here on Saturday that there is no need press panic button as the Dubai debt spark would have little impact on the Indian economy. He pointed out that the risk of a multi-billion-dollar debt default by Dubai World, would have little impact on the Indian economy. Interacting with the media persons here Mukherjee said: "There is no need to press panic button. First the amount involved is small; secondly the exposure to Dubai financial system of Indian banking system from viewpoint of direct foreign investment exposure is limited," He also said initially some affects will be there and even it was felt in the stock market but thereafter it has recovered. "There will not be any effect of the Dubai debacle on India because Indian realtors in Dubai are not the key players," Mukherjee said. Dubai World is ranked among the largest state-run conglomerates in the region. The global financial world was stunned when the state-run Dubai World announced that it would need to restructure its debt, estimated at USD 59 billion, to preempt default. On Friday, Indian stock markets tumbled, the rupee weakened and bond yields fell as Dubai 's debt problems sparked concerns about corporate exposure and the risk of foreign investors repatriating funds. Indian bond yields eased to near two-month low as risk aversion dominated market sentiment after Dubai 's debt problems revived concerns about the health of the global financial system.