The Union Finance Minister, Mr Pranab Mukherjee, has described Standard & Poor's move to downgrade the US sovereign credit rating as “grave”, but said that there was no need to press the panic button as yet.
“We will have to analyse it. Let us examine it. It will require some time. The situation is grave. There is no gain in making off-the-cuff remark now,” Mr Mukherjee told reporters here after addressing a meeting of Board of Directors of State Bank of India here on Saturday.
Earlier in the day, Mr Mukherjee said that the world was going through a difficult phase and that a piecemeal approach would not work.
“World leaders will have to stand up to tackle the situation. It is too early to comment on the effect of US sovereign credit rating downgrade on the Indian economy,” he said.
Reacting to the Standard & Poor's move to downgrade the rating, the State Bank of India Chairman, Mr Pratip Chaudhuri, said that this will not immediately affect the Indian economy.
“It will be life (business) as usual for us because the US dollar would continue to be dominant and the omnipotent currency of the world. America's borrowing costs may go up slightly. But that would not affect us. It is America's debt downgrade and so American debt will become expensive. America's interest cost will increase,” Mr Chaudhuri said here on Saturday.