New Delhi: In a bid to revive the economy, Prime Minister Manmohan Singh on Tuesday laid out a roadmap to boost manufacturing growth over the next 12 months, especially steel production.
Steps will also be taken to boost textile exports according to a 12 month plan to investors that will also send out a political message there will be no snap polls.
In a meeting chaired by the Prime Minister, the government decided to increase textile exports by 30 per cent this year. The government has also decided to create 300 million tons of steel production capacity.
Meanwhile, seeking to arrest the declining value of rupee, the Reserve Bank has imposed restriction on banks with regard to trading in currency Futures and Options (F&O) with immediate effect.
Under the new norms, the banks have been barred from trading in currency futures and exchange traded currency options market on their own. They will, however, be allowed to trade on behalf of their clients.
"On a review of the evolving market conditions, it has been decided that... banks should not carry out any proprietary trading in the currency futures/exchange traded currency options markets. In other words, any transaction by... banks in these markets will have to be necessarily on behalf of their clients," an RBI said in a late night notification on Monday. It would come into effect immediately, RBI added.
The move is apparently aimed at stemming the declining value of rupee which touched its life-time low of 61.21 to a dollar on Monday. The currency, however, recovered grounds and was trading at 60.13 to a dollar in today's trade. The RBI and the government have been taking steps to arrest the fall in rupee.
On Monday, market regulator Sebi tightened the exposure norms for currency derivatives to check large scale speculations in the market. Sebi said in a circular that it is reducing the exposure that brokers and their clients can take on currency derivatives and also doubled their margins on dollar-rupee contracts.
Currency derivative trading allows investors to take forward views on various currency pairs, including rupee-dollar, and it was being felt that large-scale speculations on their future movements might be adding to the downward pressure on the Indian currency.
With Additional Inputs From PTI
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