Greece debt crisis can have some short-term impact on India: PHD Chamber

Greece debt crisis can have some short-term impact on India: PHD Chamber

Greece debt crisis can have some short-term impact on India: PHD Chamber

 

No.PR-56
July 7, 2015
New Delhi
 

Greece debt crisis can have some short-term impact on India: PHD Chamber
 

Though short-term impact of deepening Greece debt crisis through financial, trade and confidence channels cannot be ruled out vis-à-vis India’s increased global interestedness, Indian economy is reasonably resilient and its macroeconomic fundamentals are strong, said Mr. Alok B. Shriram, President, PHD Chamber of Commerce and Industry.
 

“Our banking and financial structure is so strong that temporary  fluctuations in the global economic system can not impact us  in the short-term”, said Mr. Alok Shriram.
 

However, he crisis can have some impact on business sentiments as Greece is part of prestigious European Union (EU) and India hold a significant trade share with EU. India’s total exports to EU were estimated at US$49bn in FY2015 which comprise 15% share in India’s total exports, said Mr. Shriram.
 

Greece’s debt-to-GDP ratio has reached an EU-high of 177% while unemployment is hovering at around 25%. The massive amount of government spending designed to stimulate the economies vis-à-vis to tackle unemployment is only leading to rising debt, said Mr. Shriram.
 

However, he expressed optimism that Greece will be able to restructure its financial institutions, economy and business dynamics from the grassroots. The need of the hour is to create employment to build confidence among the people.
 

Mr. Shriram said that in view of the current global economic developments, there will not be any sharp decline in rupee from the current level. While there will not be any significant upward movement from the current level, it will also not decelerate like August 2013. During the last one year, the rupee depreciated from around 59/USD in May 2014 (average) to about 64/USD (average) in June 2015.
 

Notwithstanding, in an event of deepening of the Greek debt crisis, the domestic vulnerabilities arising from trade, financial and confidential channels will need to be dealt proficiently and swiftly, he said.
 

ENDS

Koteshwar Prasad Dobhal
Consultant (PR)