Manmohan Singh says money in Indian banks safe

November 3rd, 2008 - 3:00 pm ICT by IANS  

Manmohan SinghNew Delhi, Nov 3 (IANS) Your money in Indian banks is safe. This was the categorical message Prime Minister Manmohan Singh sought to convey to the average citizen Monday as he met leading industrialists on the current global meltdown and its impact on the Indian economy.“I think we have successfully conveyed to our people that our banking system, both in the public and the private sector, is safe,” the prime minister said during the meeting.

“The government stands behind it and that no one should fear for the safety of bank deposits.”

The prime minister’s comments came after rumours surfacing from India’s financial system that some banks, particularly in the private sector, had been severely impacted by the crisis in the global financial system.

This had resulted in the chief executives of these banks and also the finance ministry and the central bank seeking to assuage feelings that public money in the country’s banking system may not be safe.

“Our first priority was to protect the Indian financial system from a possible loss of confidence or any contagion effects. I am happy to say that the direct exposure of our banks to problem assets is minimal,” Manmohan Singh said.

“Our banks are well regulated and also well capitalised.”

The prime minister, who is scheduled to visit Washington next week for a summit called by US President George W. Bush, nevertheless said that the crisis in the global financial system was far from over.

“The financial crisis has exacerbated a global downturn that was expected earlier, but is now likely to be more severe and prolonged,” the prime minister said.

“I invite all of you to join in the effort to convert this global crisis into an opportunity for India,” he told the meeting which included the Who’s Who of India Inc.

“I would like to assure each of you that the government will take all necessary monetary and fiscal policy measures on the domestic front to protect our growth rates,” Manmohan Singh said.

“On the international front, we are working closely with other countries to ensure coordinated policy action and increased development cooperation for the containment of this crisis.”

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