Hoping to soothe the investors' worries about US Federal Reserve scaling back its asset purchase programme, the Planning Commission Deputy Chairman Montek Singh Ahluwalia on Friday said that capital inflows into India will not be impacted.
"I don't think that the expected changes in quantitative easing (QE) will make a difference to the kind of inflows that we are talking about", he said.
US Fed chairman Ben Bernanke's statement that central bank could revise QE in future meetings had spooked the equity markets on Thursday. While Indian benchmark indices slipped nearly 2 per cent, Japan's Nikkei tumbled most by 7 per cent, leading to panic in the markets.
However, Ahluwalia says that "I am not sure that is so important for us because we don't encourage short term borrowing anyway."
"What is important is that how do people see Indian economy. Do they see it well managed? Do they see it getting back to higher growth rate? Do they see ours getting rid of obstacles that held up investments", he said.