Economy robust, external factors putting pressure on 3 Fs: Finance minister Nirmala Sitharaman

NEW DELHI: Finance minister Nirmala Sitharaman on Monday said that Indian economy remains robust even in the wake of external challenges caused by the West Asia conflict and the consequent rise in prices was putting pressure on the three Fs - fuel, fertiliser and forex.

While referring to PM Narendra Modi's call to citizens to conserve fuel and avoid unnecessary forex spends, FM said: "Prices of crude have been high and fluctuating.

The increase in international price of fertiliser is unimaginable. High gold prices are posing some challenges on the external front. All these three payments have to be in foreign exchange... we also should appreciate that the challenges are more external driven."

Addressing an event organised by Sidbi in Mumbai, the minister said govt has been working to address the challenges since the budget session itself after the war broke out. "The policy response has been very calibrated and it is calibrated to absorb the shock where citizens and businesses are exposed: Support MSMEs and exporters, where working capital is under stress and preserve the underlying growth momentum," she said, adding that the Economic Stabilisation Fund was created to deal with such challenges.

She listed out a series of measures - from tax cuts to a new credit line for businesses, backed by govt guarantee, and support for exporters - to argue that the Centre has been proactive.

Later, she told reporters that govt had shielded consumers from an increase in fuel prices for 75 days and took a Rs 1 lakh crore hit due to excise cuts, but the oil retailers are now raising prices to deal with the high global prices.

"These increase in prices are not minor, all these will have to be paid through foreign exchange only. So, these are going to be challenges, but I'm confident....we will be able to handle those challenges, which are not of our making. If crude oil prices are rising, we will have to constantly monitor this, but make sure that people are not going to suffer," she told reporters after an event organised by Texprocil.

FM also said that govt was willing to hear out suggestions, including on capital gains, amid demands from overseas investors.

Sitharaman also slammed the opposition for creating a "cynical and pessimistic narrative" after PM's appeal for austerity, she said, asserting that such observations are factually incorrect.

"It (the narrative) is wrong because it is fear-mongering. India cannot afford fear-mongering. We need to give confidence to the people with our words and with our actions."

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