India’s foreign exchange reserves plunged by $5.34 billion during the week ended March 13. According to the RBI’s weekly statistical supplement, the overall forex reserves, which are already at a record high, decreased to $481.89 billion from $487.23 billion reported for the week ended March 6.

Analysts cited the RBI’s intervention to curb the slide in rupee value as a major cause for the depletion.

India’s forex reserves comprise foreign currency assets (FCAs), gold reserves, special drawing rights (SDRs) and India’s reserve position with the International Monetary Fund (IMF).

On a weekly basis, FCAs, the largest component of the forex reserves, fell by $3.77 billion to $447.35 billion.

Similarly, the value of the country’s gold reserves declined by $1.53 billion to $29.46 billion.

The SDR value dipped by $38 million to $3.61 billion, whereas the country’s reserve position with the IMF inched up by $2 million to $1.44 billion.

Meanwhile India’s consumer sentiment dampened in March amid the economic slowdown and the coronavirus crisis, according to an index prepared by Refinitiv and Ipsos.

The monthly Refinitiv-Ipsos Primary Consumer Sentiment Index (PCSI) for March 2020, has shown a 1 per cent decline over February 2020. “Three of the four indices have shown a downward slide − personal finances, personal investment and the confidence in the country’s economy. Only confidence around jobs, has slightly moved up,” said an Ipsos statement.

The PCSI Economic Expectations Sub Index has dropped by 2.8 percentage points, the PCSI Investment Climate Sub-Index has fallen by 1.4 percentage points and the Current Personal Financial Conditions Sub-Index is down by 0.8 percentage points, over the previous month, it said.

The statement said that the PCSI Employment Confidence Sub-Index has, however, moved up by 1.2 percentage points.

“We see some bit of a pessimism among urban Indians. A multitude of factors are lowering the consumer sentiment. We are witnessing a global economic slowdown and India too has been impacted.” “Coronavirus is like a bolt from the blue and its real impact, while we’ll get to know by next month, but it has already made some bit of a dent in slowing down businesses with its negative repercussions on global economies, including India,” said Amit Adarkar, CEO, Ipsos India.

The Finance Minister Nirmala Sitharaman set the ball rolling on finalising India’s strategy to combat the coronavirus pandemic and prevent its spread from causing big damage to the economy.

The FM held separate meetings with ministers who hold key economic portfolios including Animal Husbandry, Dairy and Fisheries; Civil Aviation; MSMEs; and Tourism at her office in North Block. Officials from thes ministries were also present during the discussions.

Briefing reporters after the meeting, Sitharaman said: “We had to hold these meetings considering the urgency arising from the coronavirus outbreak.” The decisions and recommendations of these meetings will be used as inputs for the economic response taskforce, that has been announced by Prime Minister Narendra Modi, in his address to the nation on Thursday evening, to assess sector-wise impact of the pandemic, and suggest measures to mitigate the losses.

The taskforce which is yet to be constituted will also be headed the Finance Minister.

Sitharaman also mentioned the latest steps taken by the security markets regulator SEBI to ensure stability in the financial markets, which have seen a severe bear run in the past couple of weeks.

Tourism Minister Prahlad Singh Patel said that he has informed her about the state of the tourism sector which has taken the maximum hit due to the coronavirus outbreak.

He said that currently assessment is being made for the grant of any relief to the tourism sector. On the issue of pay cuts and job cuts announced by some private airlines, Civil Aviation Minister Hardeep Puri said: “We are addressing all the concerns, constructively.”

Sources said that the MSME ministry has sought deferment of payments liability like goods and services tax, loan repayment and electricity bills. it has also sought a moratorium for repayment of MSME loans.

Some of theses measures may be announced soon, said people in the know.

Addressing the nation on the coronavirus crisis on Thursday, the Prime Minister announced the creation of a Covid-19 economic response task force, which would assess the requirements of various sectors and also oversee implementation of the proposed measures.

Indo-Asian News Service