India’s rupee slips state proposes Mercantilist solutions

MUMBAI, August 13, 2013 (AFP) - India's rupee fell in early trade on Tuesday despite the government announcing new measures aimed at narrowing the current account deficit and aiding the ailing local currency. Overseas funds have pulled out a combined .

49 billion in equities and debt from India's markets since June 1 on concerns about the weakening economy, regulatory data shows.

Last week, the central bank announced fresh measures to drain cash from the market to further try to stabilise the currency.

On Monday, industrial output shrank by an unexpectedly large 2.2 percent in June from a year earlier, outstripping market forecasts of a 1.2 percent drop. The rupee slid to 61.60 against the dollar on the back of a sharp contraction in industrial output and scepticism about the impact of the government's fresh measures announced on Monday.


The rupee, which hit a lifetime low of 61.80 on August 6, has fallen about 12 percent this year, amid slackening domestic growth, rising overseas fund outflows and weak exports.

Finance Minister P. Chidambaram attempted to ease market concerns on Monday by promising to curtail some imports and narrow the gaping current account deficit -- the broadest mea

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