RBI to study impact of Dubai's debt default crisis on India
Reserve Bank of India Governor D Subbarao has said the bank will measure the extent of Dubai's debt problem as well as its impact on Indian economy. The debt woes of Dubai stunned the global markets, triggering fears of a widespread default.Dubai default | Should India worry? | Govt optimisticbusiness Updated: Nov 27, 2009 22:16 IST
Reserve Bank of India (RBI) Governor D Subbarao on Friday said the bank will measure the extent of Dubai's debt problem as well as its impact on Indian economy.
"We should not react to instant news like this," Subbarao told reporters on the sidelines of a seminar in Hyderabad.
"One lesson that we learnt from the global financial crisis is that we must study developments and measure the extent of the problem and we need to study its impact on India," he said.
"I have requested my officials to study this, and if necessary we will certainly communicate to the public about what the implications likely are," the governor added.
India's financial integration with the global economy was deeper than its trade integration, he said.
"We were affected because we are more globally integrated than we had consciously recognised."
Dubai World, a state-run investment company, which is thought to have debts totalling around $59 billion, on Wednesday informed creditors that it is deferring payments until May.
The debt woes of Dubai stunned the global markets, triggering fears of a widespread default.