E-Paper
Tsunami not to affect economy'
However, RBI has said that there may be reduction in exports to the tune of $200 million in the current financial year.
The Reserve Bank of India (RBI) said on Thursday that the tsunami will not have much impact on the economic growth of the country and the price level, but there may be reduction in exports to the tune of $200 million in the current financial year.
Tsunami has not caused significant physical disruption in the economic activity nor much impact on exports and imports, RBI Governor YV Reddy told reporters on the sidelines of a function at the National Institute of Bank Management in Pune.
The possible reduction in exports due to the disaster was expected at $200 million, Reddy said.
Asked about the impact of rise in sugar and cement prices in the wake of the disaster, he said there would not be much impact on prices (inflation).
On the impact of tsunami and downturn in stock market on foreign exchange market, he said the central bank was looking at the spillover effect.
The insurance sector would be affected due to claims, he said.
The RBI does not expect any increase in the borrowings due to the disaster and, if required, the government would be able to raise additional resources for relief without strain on the system, he added.
