India to unveil steps to curb rupee's slide

The Indian government and central bank are set to announce measures on June 25 to halt a slide in the rupee, which sank to a record low of 57.37 against the dollar yesterday, Indian Finance Minister Pranab Mukherjee said. The Finance Minister said that the government would announce measures in consultation with the Reserve Bank of India (RBI) on Monday that would improve "market conditions". The steps, he said, are being taken following a consultation between RBI governor D Subbarao and Department of Economic Affairs secretary R Gopalan. The Finance Minister made his comments to reporters in Kolkata today and broadcast on Indian local television news channels. The rupee is the worst-performing currency of the past year, having tumbled 21 per cent against the dollar, and reached an all-time low yesterday of 57.3275 per dollar. Fitch Ratings cut India's sovereign credit-rating outlook to negative on June 18, joining Standard and Poor's in signaling the country is at risk of losing its investment-grade status. Indian companies face a record $5.3 billion of maturing foreign-currency debt this year, data showed. The Reserve Bank of India on November 17 increased the caps on overseas investors' holdings of India's local-currency government debt and corporate bonds by $5 billion each to boost inflows and arrest the currency's decline. The central bank has asked oil refiners to obtain 50 per cent of their dollar requirements from a single state-owned bank, Oil Secretary G.C. Chaturvedi told reporters in New Delhi on Saturday. India buys 80 per cent of its oil from overseas and pays for supplies in dollars. Every one-rupee drop in the domestic currency against the dollar boosts annual revenue losses for the three government-owned refiners by Rs80 billion ($1.4 billion), the oil ministry said in November. (QNA)