The uncertainty in the global markets due to recent developments in United States of America (USA) and Eurozone has had some impact on major markets across the globe, including India. However, Indian markets were less affected as compared to some of the major Asian and European markets. Fluctuations in markets are not unusual. Market movements are the outcome of perceptions of the investors about the economy, its various sectors and companies. The perception is influenced by many factors including the macro-economic environment, the growth potential of the economy, performance of companies, corporate governance, policy initiatives of the Government, domestic and international events and market sentiments.
The Indian economy is comparatively less dependent on exports. It is primarily dependent on domestic drivers for its growth. In addition, Indian exports have also seen appreciable growth in 2011-12 and is today more geographically diversified. Indian banking sector is robust and the calibrated approach to capital account convertibility has prevented surge and reversal of debt creating capital flows. The Indian economy also has strong fundamentals.
The Government maintains a close watch on global developments and action is taken when necessary to protect its markets. Government and financial sector regulators are constantly endeavoring to build systems and practices to deepen and broaden the markets.
This information was given by the Minister of State for Finance Shri Namo Narain Meena in a written reply to a question raised in Rajya Sabha today.