RBI, government assure FIIs; India Inc hits back

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New Delhi: Seeking to calm rattled investors, the government and RBI on Friday said there was no reverting to capital control regime — the fear of which spooked stock market, sent rupee to its lowest level and pushed gold prices up by a record Rs 1,300 per 10 gm.
On a day when Sensex fell nearly 770 points or 4 per cent and rupee breached 62 to a dollar on concerns among large investor of capital curbs, the government and RBI went into fire-fighting mode assuring there was no move to check repatriation of funds by FIIs.
“They are saying that a capital control is coming in. There is no question of us putting any restriction on outflows which are commercial in nature, which means whether it is FII sell,” economic affairs secretary Arvind Mayaram told reporters here.
He further said: “there is no control of outflows of dividends, profits, royalties, or on any kind of commercial outflows which happen in normal course”. 
India Inc hits back at RBI
Industry chamber CII on Friday hit out at the measures taken by RBI to arrest slide in Indian Rupee, calling it as “retrograde”. 
“The Reserve Bank of India’s step to contain current account deficit by imposing a cap on outward investment acts against the Indian economy’s globalisation drive and detracts from the overall reforms process,” said Kris Gopalakrishnan, president, Confederation of Indian Industries (CII).
CII noted that the reduction of limit in outward investment from 400 per cent of net worth to just 100 per cent under the automatic route was too drastic a step.