Indian
economy might have found its messiah in
International Monetary Fund head
Christine Lagarde. In an interview with the Times of India before a two-day visit to India, Lagarde has said that the country is in a better shape to cope with external financial shocks than most emerging market economies.
The agency report reveals, Lagarde is due to give a speech in Delhi today and will meet officials from the Reserve
Bank of India in Mumbai tomorrow.
This comes ahead of a crunch meeting of the
U.S. Federal Reserve. The Fed, at its meeting ending Wednesday, is expected to signal an increase in its ultra-low interest rates by as soon as June, potentially triggering capital outflows from emerging markets that have been flooded with cheap dollars.
In September 2013, Ben Bernanke, the then chairman of the U.S.
Federal Reserve, caused a heavy selloff in the Indian rupee, bonds and stocks when he announced the Fed was to scale back its $80 billion a month quantitative easing programme.
"India has prepared better than most emerging-market economies for any such external shocks," Reuters quoted Lagarde. He further added that India had shrunk its current account deficit and boosted its stock of international reserves.
In an annual report last week, the IMF said that India's economy is recovering. But growth, which it forecast at 7.5 percent in the fiscal year starting April 1, would fall just below government expectations, Reuters has reported.
(Image: Reuters)
