Madurai: India should closely monitor the foreign exchange reserves, which stood at $248 billion in 2008-09 compared to $309 billion in the year ago period, T.C. Venkat Subramanian, Chairman and Managing Director of Export Import Bank, has said.
Delivering the convocation address at Thiagarajar School of Management here yesterday, Subramanian blamed America for the global economic crisis and said it turned out to be “toxic acid for the US economy”.
Forex reserves drop by $1.5 b
He said the economic meltdown began in America and when its imports fell, it started affecting the economies of other countries, including Japan and the European Union. American people had borrowed heavily for their homes without focussing on savings.
“Negative savings rate in that country made things worse, affecting the financial system," he said. He said remittances from the Indian workforce are likely to come down by 10-15 per cent.
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The forex inflow through foreign direct investment, stock markets and foreign institutions had come down from $64 billion to $13 billion. However, he said the IT companies would revive by 2010 through cost cutting.